GKN lining up China joint venture - report

Engineer GKN is close to setting up a joint venture with Chinese state aerospace manufacturer Comac, according to a report on Wednesday.

GKN's partnership with the Chinese colossus have agreed a wide-ranging joint venture, Sky News reported, citing a Whitehall source.

Last month, GKN warned full-year profits before tax will be only slightly ahead of their 2016 level as a result of two significant "commercially sensitive" external claims and continuing headwinds at GKN Aerospace North America, with the latter expected to drag on the group's trading margin.

Those two claims were seen resulting in a charge of roughly £40m which would be incurred in the last three months of 2017.

Third quarter trading at its aerospace arm was described as "disappointing".

Military sales were up and commercial small aircraft sales down but margins were hit by continued pricing pressure and operational issues. A significant non-cash impairment charge will be taken on the North American aerospace business.