Airtours' bid may be frozen

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THE CLOCK could stop on Monday for Airtours' pounds 237m hostile bid for the rival holiday operator Owners Abroad, if, as expected, there is no decision from the Department of Trade and Industry on referring it to the Monopolies and Mergers Commission.

Yesterday the Office of Fair Trading said it had not yet sent the DTI its advice on the bid. Consideration over the weekend is unlikely and the DTI's decision is expected instead late next week.

Monday should be the last day on which Owners could produce a defence. If the bid is frozen, however, it will be allowed a further two days once the DTI's decision has been made.

Industry sources feel that the bid would be a prime candidate for MMC scrutiny. A combined Airtours/Owners Abroad operation would be able to influence an estimated 80 per cent of the UK holiday market, through jointly- owned airlines, tour operations and travel agents.

Airtours yesterday extended its offer for Owners Abroad until 4 March after it gained only 0.4 per cent of Owners Abroad's shares and 1.23 per cent of the convertible preference share capital.

The markets are poised for an increased offer from Airtours, the UK's third-largest tour operator, for Owners, second in size only to Thomson in the UK.

There is, however, some uncertainty among analysts over a possible pounds 6.5m exposure by Owners to unsold leases on property, which, it is thought, may deter Airtours from increasing its price.

The Owners board favours a link with Thomas Cook, the German-owned travel company. Under that plan Thomas Cook would take a 10.3 per cent stake in Owners which, in turn, would lend Thomas Cook pounds 20m to develop further its high-street travel agencies.

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