From Our Motoring Correspondent
A big link-up between two of Britain’s most successful motor car and racing engine manufacturers was announced last night. Jaguar Cars Ltd. disclosed that they have agreed to acquire by an exchange of shares the Coventry-based engineering company of Coventry Climax Engines Ltd. No amalgamation of products is planned at present, and there are to be no management changes in Coventry Climax. The heads of both companies said that they regarded the move as one that would strengthen their interests.
Jaguar’s said: ‘This acquisition has been made to extend still further the range of products manufactured by the Jaguar organization, which consists of the parent company, the Daimler Company and its subsidiaries, and Guy Motors (Europe) Ltd.’
Coventry Climax engines have earned a world-wide reputation, as power units for fork-lift trucks, and in racing form, of which the 1,500 c.c. V8 cylinder engine is the best known.
‘ It is intended that the manufacture of existing products will continue as previously ‘, the Jaguar statement added. I was assured that the move does not signify any change in Jaguar’s attitude to motor sport. The company still have no intention of returning to motor racing, and the acquisition is unlikely to affect this decision. Jaguar’s revealed the terms of their offer, which is to acquire the whole of the issued 175,000 A ordinary shares and 125,000 B ordinary shares of Coventry Climax Engines. Ltd.. on the basis of 10 ‘ A’ ordinary shares in Jaguar for every seven ordinary shares of either class in Climax.
TERMS OF OFFER
The offer is conditional upon the passing by Jaguar of the necessary resolutions for the increase of their capital. Mr Leonard P. Lee, managing director of Climax, his colleagues and friends. have accepted the offer in respect of their holdings, which aggregate over 75 per cent of the shares affected. Holders of further shares, bringing the total to over 90 per cent, have indicated their intention to accept. Jaguar’s said they intended to offer to acquire by exchange of shares the preference capital of Climax.
They emphasized their intention of retaining the same management, and said that Mr Lee will remain as managing director of Climax. The negotiations have been going on several weeks, but the deal has no connection with the Climax decision last autumn to withdraw their support from Grand Prix motor racing-a decision later reversed, after arrangements with the oil companies and racing teams allowed a more economical price to be paid for the company’s Formula 1 engines.
Sir William Lyons, the Jaguar chairman, said last night: ‘An integration of the two companies could lead to great progress.’.
Mr Leonard Lee, Coventry Climax chairman, said : ‘This is the greatest thing that has happened to us….I think it is a wonderful opportunity for us to develop far more quickly than would have otherwise been possible. I suppose it is a take over, but I hope nobody takes the term in its worst sense. We shall work together with Jaguars. It is not a question of us closing down.’