The uncertainty caused by the Ukraine conflict prompted Spectris to axe its £1.7bn bid for rival Oxford Instruments.
(Picture: AP)Hi-tech instrument maker Spectris has scrapped its £1.7 billion bid for rival Oxford Instruments, blaming the war in Ukraine for “creating significant uncertainty in global economic conditions”.
Spectris CEO Andrew Heath claimed there was a “compelling strategic and financial rationale” for a merger, which could have created a FTSE 100-sized firm, but said “the world has changed since our proposed offer was made”.
Heath said: “Since there is no certainty when the situation will be resolved and market conditions will improve, the board has concluded the proposed combination is no longer in shareholders’ best interests at the current time.”
Oxford Instruments said: “The proposal was unsolicited and the board continues to believe that Oxford has a clear and compelling strategy to achieve growth and create value for shareholders over the medium-term.”
Shares in Oxford Instruments, which makes specialist devices to aid cutting-edge research and precision measurements across various industries, rocketed by nearly a third to 2665p on February 28 when Spectris confirmed bid discussions were under way.
The stock fell 612p, or 27%, to 1668p this morning.
Heath called the war “extremely distressing” and said his firm did not conduct any business in Ukraine, but was doing “everything we can” to help its colleagues whose families are hit by the invasion, as well as supporting the relief effort for the people of Ukraine.
The bid by Spectris, which was founded in the early stages of the aviation industry in the First World War, came just days after its full-year results, which received a lukewarm response from investors.
The company turned a £4.1 million loss in 2020 into a £388.6 million pre-tax profit in 2021, but this was largely due to the sale of one of its businesses and a drop in administrative expenses.
Shares rose nearly 4% to 2556p on the back of today’s news of the bid being axed.
Oxford Instruments posted a £21.4 million pre-tax profit for the six months to 30 September, up nearly 6% on the £20.2 million figure from the same period in 2020.
