Cobham makes $3.6 billion bid to buy defence rival Ultra Electronics By Reuters

(Reuters) -British aerospace and defence group Cobham (LON:COB) has made a takeover offer for Ultra Electronics in a deal valuing the defence engineering supplier at about 2.58 billion pounds ($3.55 billion), Ultra said on Friday.

The offer represents about a 42% premium to Ultra’s last closing price and was higher than a previous bid made in June, Ultra said.

Cobham, which was taken private by private equity firm Advent International last year for 4 billion pounds, has proposed paying 35 pounds per share in cash for London-listed Ultra, with shareholders also entitled to the interim dividend of 16.2 pence apiece, Ultra said.

It said it could recommend the proposal to its shareholders.

Cobham, known for its pioneering air-to-air refuelling technology, has told Ultra that it was “minded” to offer undertakings to the British government in respect of national security.

On Friday, Ultra said Cobham first made a proposal at a price of 28 pounds a share in June.

The two companies both operate in the aerospace and defence sectors. In a June statement confirming talks, Cobham said it was interested in Ultra with a view to creating a “global defence electronics champion” as they provide complementary solutions to the United States, UK and other key allies.

($1 = 0.7271 pounds)