MELROSE INDUSTRIES (=) : Incident at US facility forces evacuation of 50k people

Research evidence excerpt

MELROSE INDUSTRIES (=) : Incident at US facility forces evacuation of 50k people

EQUITIES

AEROSPACE & DEFENSE

MELROSE INDUSTRIES NEUTRALPRICE* 510p  TARGET PRICE 570p (UPSIDE 12%)

FLASH NOTE

Incident at US facility forces evacuation of 50k people

26 MAY 2026 Securities Research Report Production time: 09:43 (London time)

Research Analyst & Publishing Entities

Stephan Klepp, CFA BNP Paribas London Branch (+44) 734 573 1907 stephan.klepp@uk.bnpparibas.com

What happened?

Melrose published a RNS this morning informing about an incident at their Garden Grove factory in California.

The site: Garden Grove is a smaller facility with GBP136m in revenues, which is c.4% of group revenues. The site is

part of the Airframes division and its Transparency subsector; producing amongst other things windows for the CH-57K

helicopters and canopies for the F35 fighter jet. The plant went through a significant capacity increase recently to supply

the required canopy volumes for the F35. Aim was to be in full operation of the expansion in the second half of 2027.

The incident: A thermal issue arose with one of the large chemical storage tanks. That tank contains methyl

methacrylate (MMA) used in the production of high-strength aerospace acrylic materials. MMA is a colourless, volatile

liquid with a sharp, fruity odour, widely used in manufacturing acrylic plastics, coatings, adhesives, resins, and medical

materials. It is highly flammable and can polymerize under heat or pressure, creating risks of fire, explosion, and vapor

release. The MMA tank bulged and was at risk of exploding due to overheating.

The impact: After three days of working on the incident, the local authorities confirmed that no injuries, leaks or

contamination have occurred.