Shares of Melrose Industries rose 8.5% to 501.2p on Tuesday after California’s Orange County District Attorney closed a criminal investigation into a chemical incident at its GKN Aerospace subsidiary without filing charges.
The probe stemmed from a May 2026 incident at the GKN Aerospace plant in Garden Grove, California, which prompted the evacuation of more than 50,000 residents. The closure of the investigation removes a key overhang for the FTSE 100-listed company, whose shares remain 26.6% below their 52-week high of 682.6p.
GKN Aerospace separately announced a $100 million compensation program to reimburse residents and businesses affected by the evacuation. Payments will be administered by an independent third party, with the company stating it remains committed to supporting the local community.
The incident disrupted operations at the Garden Grove facility, prompting prosecutors to set a target date of September 28 for the resumption of full production capacity. Melrose had previously suspended a £175 million share buyback program in July following the disruption, which was announced alongside its first-half results on July 31.
Melrose Industries operates as a pure-play aerospace supplier, serving both civil and defense markets through its Engines and Structures divisions. The company’s exposure to GKN Aerospace, a key aerospace components manufacturer, has weighed on its stock performance amid operational and regulatory challenges.
