(Reuters) - Melrose Industries 7 billion pound ($9.7 billion) hostile bid for engineering group GKN got a green light from its shareholders and the European Union on Thursday as its takeover attempt enters a critical stage.
British industrial turnaround specialist Melrose said 98.5 percent of shareholders that voted had approved the proposed deal and a plan to issue shares to help finance it, while the European Commission has given anti-trust clearance.
A spokesman for GKN, which supplies parts for the Black Hawk military helicopter and Eurofighter Typhoon, declined comment.
Melrose took its cash-and-share bid directly to GKN investors after the board of the FTSE 100 aerospace and automotive parts group rejected its unsolicited approach in January.
Since then, Melrose's approach for GKN, a mainstay of the UK's engineering sector, has drawn intense scrutiny from British politicians amid concerns a takeover puts jobs and GKN's pension scheme at risk, and could compromise national security.
The battle could intensify in the coming days as under the bid timetable, March 12 is the final day on which GKN can release new financial information to defend itself.
The next milestone is March 19, which is the deadline for Melrose to improve its bid. So far, it has only made one offer.
Melrose's takeover attempt is complicated by talks GKN is holding with Dana Inc about a potential sale of its auto business. If it agrees a sale to Dana, it could force Melrose to lift is bid.
GKN said earlier on Thursday that under its current turnaround plan, which does not assume a sale to Dana, it expects to generate a recurring annual cash benefit of 153 million pounds from the auto division through costs savings and other improvements by the end of 2020.
(Reporting by Ben Martin in London and Noor Zainab Hussain in Bengaluru; editing by Jason Neely and Alexander Smith)
By Ben Martin and Noor Zainab Hussain