Allied branded Hercules criticisms of its performance as misleading and spurious. It also said the number of acceptances that Hercules had received, currently 0.94 per cent of Allied's shares, was minimal.
David Farrar, Allied's chief executive, said: "Hercules has had to grasp at straws and has had to use thoroughly misleading arguments. Shareholders should reject its rhetoric and its offer."
Mr Farrar added that the group was determined to remain independent and that is was not looking at the moment for a "white knight" to protect itself from Hercules. A spokesman for Hercules retorted: "Today's statement has barely addressed the serious questions and concerns we have raised. Once again Allied Colloids has not added any substance to the debate."
Sources suggested Hercules was considering raising its offer to provide a knock-out blow. However, the group is unlikely to raise its bid before Allied produces its final defence document on 4 January.
Allied dismissed suggestions that the acquisition of CPS, a US chemicals group, would dilute earnings and that it was massaging profits at its core business by transferring sales from CPS. Allied is visiting its large institutional shareholders in an attempt to get them to hold on to their holdings.
Allied's shares remained unchanged at 165p.Reuse content