UK government intervenes in sale of Better's Northern Aerospace

Better Capital announced at the beginning of June that it had agreed to sell Northern Aerospace to Gardner Aerospace, a wholly-owned subsidiary of Chinese business Shaanxi Ligeance Mineral Resources. Completion was due on 22 June.

In a statement, the government asserted that under the powers set out in the Enterprise Act 2002, the Secretary of State for Business, Energy and Industrial Strategy is able to intervene in proposed mergers on national security grounds. The Competition and Markets Authority (CMA) will now prepare a report on the competition and national security aspects of the proposed transaction, due by 13 July.

Better Capital said in a statement it was "surprised" by the decision but added that work had commenced "to ensure that all necessary information is provided to the CMA during the course of their investigation".

Better Capital acquired aerospace manufacturing business CAV for £40m in 2015 – it was later renamed Northern Aerospace following a restructuring. The company supplies complex metallic components and sub-assemblies to original equipment manufacturers including Airbus, Embraer and Gulfstream.

Better Capital previously owned Gardner, having sold the business to trade buyer Shaanxi Ligeance Mineral Resources (SLMR) in a 2017 deal giving Gardner an enterprise value of £326m. The transaction followed a seven-month exclusivity period and generated a 7x money multiple and an IRR of 35.3%. Gardner was Better Capital's maiden investment, with the GP acquiring the business from Carlyle in a £20m deal in February 2010.

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