Business minister Lord Grimstone has said UK firms perform better under foreign ownership and insisted there is nothing to fear from the spate of overseas bids for the likes of supermarket chain Morrisons.
Lord Gerry Grimstone – the former deputy chairman of Barclays – claimed British firms that have been bought out by foreign groups are “more productive”, hire more staff and export more.
It comes amid a flurry of overseas deals for UK-listed companies, with retail giant Morrisons at the centre of a bidding war and takeover tussles also ongoing for defence contractors Meggitt and Ultra.
“All our research shows that overseas invested companies in the UK are more productive… they generate more jobs than UK companies, they generate more intellectual property and they export more.”
He added: “Overseas investment is vital for the UK’s economic performance.
“I don’t think we should be fearing overseas investment – we should be grasping it because of the economic impact it has on our country.”
But it comes as pensions trustees of Morrisons have warned the takeover by either of its two leading suitors could “materially weaken” the security of the pension schemes.
The Morrisons’ board said last week it agreed a £7 billion takeover by US private equity firm Clayton, Dubilier & Rice (CD&R).
The offer usurped a previously agreed £6.7 billion deal with a consortium led by private equity rival Fortress.
Lord Grimstone’s comments follow the announcement that the Government will hold an international investment summit in October to attract overseas investment in the UK.
On worries over British firms falling into foreign hands, he said: “It would be a sad day for this country if we put the shutters up so that we weren’t a mercantile entrepreneurial country,” he said.