The sale of the aerospace division of UK engineering group Smiths to the US industrial behemoth GE has reignited fears among some commentators that Britain is slowly but surely seeing its technological crown jewels fall into foreign hands.
In business terms the £2.4bn deal made good sense for Smiths Group, its shareholders and the aerospace business, which will enjoy all the advantages of scale that come from being part of one of the world’s largest companies. And as part of the agreement, Smiths Group secured the lead role in a new joint venture with GE focusing on detection and homeland security systems, one of the world’s fastest-growing technology sectors.
This has not stopped the murmurings of unease, however. The reason for the disquiet is Smiths Aerospace’s position right in the middle of the high-tech end of the aerospace and defence sectors.
It is a fair assumption that if the deal had involved, for example, a food business, there would have been less soul searching in the newspapers.
Aerospace and defence, however, are two of the areas in which the UK can still justly claim a position among the world’s elite. To some, seeing £2.4bn worth of the sector pass into US control makes that position seem less secure than it did a week ago. Speculation duly followed over which of ‘our’ medium-sized aero and defence businesses would be snapped up next.
And in reality, the location of the head office brass plate matters less than the fact that the high-value jobs and skills stay in the UK. They are the big prize, and securing them requires the investment of time, effort and money in our national high-technology infrastructure.
Get that right, and the investment will flow in from around the world. To see this effect in action you only have to look at another part of the GE empire, its Healthcare division, which is based in the UK.
Who owns the deeds is less important than where they spend their money. The challenge is to make sure they do it here.
The Engineer & The Engineer Online