There has rarely been a take-over battle so bitter and personal. The implications of the high-stakes bid by Granada for Forte go far beyond the City's Square Mile, potentially affecting the lives of the millions of Britons who pull into motorway services, stay at budget hotels or grab a meal at a "family" restaurant just off the A23.
In one corner lurks mighty Granada, clutching two years' worth of secret research on its prey, convinced that its management style, innovation and intelligence give it an insuperable edge. Dogged in adversity, Forte is just as resolute. Sir Rocco Forte, the scion of the company's family founders, is so intent on rebuffing the predator that he is prepared to break up the company and sell on some of the pieces.
For a bid that involves two giant, publicly trading companies, it is astonishing how personal the battle has become. Granada's Irish-born chief executive, Gerry Robinson, has "a big mouth" and "knows nothing about" hotel management, Sir Rocco says.
Mr Robinson ridicules Forte's poor management, and slyly derides Sir Rocco's penchant for shooting, an activity upon which the hapless hotels executive had been embarked just as Granada's pounds 3.2bn bid was being announced last month.
It was easy enough for the media to fuel the personal jibes. The two men seemed so different: Mr Robinson, the self-made man and professional manager, complete with infectious laugh and, paradoxically, a reputation for ruthlessness; and Sir Rocco, heir to a family catering fortune, aloof and diffident. They even have different theories about work: Mr Robinson is a four and a half day-a-week man, dissmissive of most over-working executives; Sir Rocco is a self-confessed workaholic.
Following two weeks of trading insults and criticisms, the two sides were finally ready to talk about the fundamentals. Forte said it would "demerge" its restaurants businesses - chiefly comprising its chain of Little Chef and Happy Eater outlets - and prune its hotels operations, which include some of the world's best-known properties such as the George V in Paris and the Grosvenor House in London.
The radical response caught Granada off guard, and the predator was reduced to repeating that it could do more with Forte's assets than anybody else. But Forte was holding back its ace - an agreed deal to sell its restaurants business to Whitbread, the brewing and food retailing company, which was unveiled this week.
It was now Sir Rocco's chance to be smug, pointing out that Mr Robinson was holidaying at his country home in Donegal, Ireland, while Forte managers and advisers were working furiously in London.
Suddenly, the situation had become seriously complicated. Granada was offering to buy the whole of Forte, but was particularly attracted by the restaurants. By reaching a deal with Whitbread, which is conditional on the Granada bid lapsing, Forte has thrown down the gauntlet. The outcome of the battle is now so finely balanced that few are willing to predict which way it will go. In Granada's favour are Mr Robinson's stellar reputation as a cost- cutting, profit-maximising manager, its prowess at running catering and roadside services, and its ability - if pushed - to sweeten the bid.
But Granada also has vulnerable spots. Its bid reminds many of the bad old days of 1980s conglomerates. Why should a company that knows lots about catering and television - Granada TV and LWT are both in its stable - be any good at running hotels? If Granada has to raise its bid to as much as pounds 4bn to win, can it find savings to compensate?
Forte, for its part, can claim that it has answered at least one concern of shareholders: that it had not made the most of the restaurants business. The answer it has come up with may look draconian; but pounds 1bn in cash from Whitbread could go a long way towards convincing shareholders that the present management should be given another chance. This is particularly the case if, as Sir Rocco and many experts argue, the hotels industry is beginning to turn upward once more.
Aside from the controversial "trophy" hotels, some of which may eventually be sold anyway, Forte relies on its chain of Meridien properties and its Posthouse and Crest middle-market hotels. Analysts believe the chains will be hugely profitable given the right management.
The restaurants, of course, will change hands whatever the outcome of the takeover bid. Both Granada and Whitbread have some radical plans.
A look at how Whitbread manages its existing range of eating-out places provides a taste of what is to come. Just along the majestic South Downs Way from Truleigh Hill, above Devil's Dyke in East Sussex, sits a squat low-lying building neatly surrounded by a car park. Inside, rows of tables are ranged around a main room, one step down from the long bar and the food service area. On each table, lies a colourful menu and a plaque with a number. This is a Brewer's Fayre, one of 266 in the country, and it is fast becoming the new face of the mid-market English restaurant. The Whitbread "format" boasts a family atmosphere, standard food, fed by centralised kitchens and ordered, prepared and delivered thanks to state-of-the-art information technology. "Take note of your table number," the sign says, "before you order your food."
Woe betide anyone wanting to mix and match from the menu.
Whitbread now wants to bring its well-tried concepts to Forte's restaurant business. Indeed, refurbishing the sites, and bringing in new technology, is arguably Whitbread's chief justification for offering to take the restaurants.
Consider the results: a chain of 430 restaurants where you know exactly what you will get: a kind of McDonald's without the formica.
Whitbread has already proved that the format works. Its Beefeater and Brewers Fayre chains put sit-down dining within reach of the average family, and its brand names, notably Pizza Hut, attract customers who know in advance what they want.
Under the leadership of Peter Jarvis, chief executive, Whitbread has caught a wave that has come to dominate the food retailing business. Increasingly, branding and predictability are the driving forces. Granada knows it too: it has put Burger Kings into its motorway service outlets, just as Forte has invited in McDonald's to some of its 26 Welcome Break sites.
In the end, it will be up to Forte's shareholders to decide which of the two companies will get a chance to prove the point. For the consumer, however, the future is already sharply focused. More standard fare, at reasonable prices; a hotel room for pounds 35 a night that looks the same in the North as the South; branded fast food every two dozen miles along the M1. Does it really matter who wins?Reuse content