Allied spurns Punch to back Whitbread offer
Wednesday 07 July 1999
Allied directors argued that Whitbread offered shareholders greater certainty and safety.
Analysts and investors said there was little to choose between the bids and agreed that timing and issues relating to the exclusivity agreement between Allied and Whitbread were at the heart of the unanimous recommendation.
Hugh Osmond, the chairman of Punch, claimed the issue hinged on the Allied board's fear that it would break the exclusivity agreement with Whitbread and risk legal action if it recommended the Punch bid. "It's not about value," he said.
Shareholders, who will be sent the terms of both offers, will be invited to a specially convened EGM on 23 July to decide which bid they prefer.
However, Mr Osmond did not rule out the possibility of another offer before then while David Thomas, the chief executive of Whitbread, said he expected Punch to make another bid.
Mr Thomas said: "I would anticipate they will do everything in their power to increase their offer. That would be in the nature of the consortium and the way they've behaved to date."
Mr Osmond said: "I wouldn't say we're actively considering it but I wouldn't rule it out. If shareholders want to see a restructured offer, we would listen."
An analyst said: "Punch may increase its bid. The difference between the two is minimal at the moment. It's quite possible the difference in warranties makes the Whitbread one the safest at the moment."
Punch spent the day yesterday suggesting that acceptance of the Whitbread offer against the trend of the market was the result of the "old boys club of the beerage" and claimed that issues of corporate governance were at stake.
However, sources indicated that the board's decision had more to do with Philip Bowman, the chairman of Allied, persuading Sir Christopher Hogg, the chief executive, to back Whitbread.
Mr Thomas emphasised that certainty was behind the recommendation for Whitbread. "They know what they get when they sell to Whitbread."
Outlook, page 19
A cautionary tale for ambitious would-be authors
X Factor judge will appear in court later this month
- 1 Gurdwaras-turned-food banks: Sikh temples are catering for rise in Britain’s hungry
- 2 Council bans use of word ‘Commie’ – but ‘fascist’ and ‘Nazi’ are fine
- 3 The poorest pay the price for austerity: Workers face biggest fall in living standards since Victorian era
- 4 Newly vegan Beyoncé wears fox fur to dine in meat free restaurant
- 5 'I'm experiencing austerity as well', says Princess Michael of Kent
- < Previous
- Next >
iJobs Money & Business
£44000 - £55000 per annum + Excellent Benefits: Pro-Recruitment Group: Confide...
£25000 - £35000 per annum + Benefits : Harrington Starr: PHP Symfony2 Framewor...
£40000 - £55000 per annum + Bonus and Benefits: Harrington Starr: A leading pr...
£50000 - £60000 per annum + Bonus + Benefits: Harrington Starr: Market Data An...