Allied still open to rival bids
It is understood that Punch Taverns, the privately owned group that owns 1,800 pubs, will have longer than the usual 21 days to come up with a higher offer for Allied's 3,600 outlets once the deal is announced.
The concession comes after a series of delays in the completion of Whitbread's offer. An announcement was due last week but has been put off until Wednesday. One source said: "It's next week or never."
Hugh Osmond, Punch Taverns chief, believes he can come up with a higher offer.
Analysts also consider that Bass, the leisure group which has also expressed an interest, would be able to out-bid Whitbread based on it superior potential for cost savings. Allied shareholders would then have to choose between the bids.
There are signs that Allied has become more open to the interest of rival bidders, following earlier criticism of its decision to enter exclusive negotiations with Whitbread. Mr Osmond has been especially critical of Allied's conduct after having had his own approach for the pubs rejected just days before news broke last month of the talks with Whitbread.
Punch and other interested parties are also expected to gain access to the confidential information which Whitbread has been able to study, notably details of Allied's supply agreement with Carlsberg-Tetley and the tax implications of any deal. While Whitbread's all-share offer for the pubs would be exempt from capital gains tax, any cash bid from Punch would incur a major liability. Mr Osmond denies that this is an obstacle to a knockout bid.
Punch last week confirmed that Texas Pacific, the US buy-out specialist, had bought a 70 per cent stake in the venture. Texas Pacific is understood to be committed to Punch's interest in Allied's estate. Two other venture capitalists, CVC Capital Partners and Legal & General Ventures, are also thought to be interested in backing Punch.
Victory for Whitbread would force it to dispose of its brewing division. Whitbread would also acquire First Quench, the off-licence chain, and it would become the country's biggest landlord with 7,600 pubs.
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