Ultra Electronics terminates talks with Cobham

Aerospace and defence group Ultra Electronics was under the cosh on Monday after saying at the end of the last week that it had terminated "very early stages" of exploratory talks with Cobham about a possible combination of some of their units.

Ultra said it had been in talks about possibly combining all or some of its Intelligence and Communications Strategic Business Unit and entities within Cobham's CAES group.

Cobham, which is backed by private equity firm Advent, said in a separate statement that a number of structures were under consideration to effect a combination, including a contribution of Cobham into Ultra in exchange for new Ultra shares or a possible offer for Ultra by Cobham.

However, Ultra said that Advent and the CAES parent had confirmed they were not actively considering an offer for the company.

At 0822 BST, Ultra shares were down 5% at 2,184p, having rallied sharply on Friday.