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LONDON, April 24 (Reuters) - Britain's business minister said there were no national security grounds to intervene in turnaround specialist Melrose's takeover of UK engineering company GKN, giving the deal the green light from government.
Melrose clinched an 8 billion-pound ($11 billion) takeover of GKN in March in a deal which the government said it needed to examine for any public interest concerns.
During the three-month battle for GKN, lawmakers had raised concerns that Melrose could in the future sell GKN's aerospace business, which is involved in defence programmes, to an overseas buyer.
But business minister Greg Clark said told parliament on Tuesday there were no grounds for objecting to the deal and that Melrose had agreed to more undertakings with the Ministry of Defence.
"On the basis of the commitments given relating to national security, the ministry of defence concluded that statutory intervention is not required," Clark said in a statement.
"My judgement is that there are not reasonable and proportionate grounds to make a statutory intervention on the grounds of national security," he added.
Security worries had centred on GKN being a supplier of parts to the Eurofighter Typhoon jet.
Clark said Melrose had agreed to keep the government informed of any advanced plans to divest the business or parts of it, and agreed not to dispose of any parts of the business without the consent of the government, amongst other promises.
"In important respects, these undertakings go beyond commitments given by the previous management team," Clark said.
Melrose had already made a series of legally binding commitments about GKN's future ahead of the takeover. They included pledges on research and development expenditure and a promise the combined firm would remain headquartered in Britain.
Reporting by Sarah Young; additional reporting by William James, editing by Stephen Addison