Applied Power raises bid for Vero to pounds 116m

THE BATTLE for control for Vero Group, the electronic components firm, escalated yesterday, when Applied Power trumped its rival with a higher bid that has won the support of the target company's board.

Vero announced it had agreed to a pounds 115.5m offer from Applied Power, which is a diversified engineering company.

Applied Power had earlier made a pounds 94.4m bid for Vero on 23 April but was trumped by a pounds 102.2m bid from another US company, Pentair.

The offer values each Vero share at 192p. Vero shares were quoted 13p, or 6 per cent higher, at 195.5p by the close of business today.

Vero said the offer represented a premium of about 61.3 per cent to the closing middle market quotation of 119p per Vero share on 19 March, the business day preceding the announcement of the approach.

Applied Power expects its improved offer, though higher than its earlier one, would be accretive to earnings per share in the first full year of ownership.

The company, however, said that the statement did not mean that its future earnings per share would be necessarily greater than its EPS for the financial year to 31 August, 1997.

Vero's directors, representing 16.4 per cent of shares, have already given undertaking to the offer.

Brian Gay, Vero's group managing director, said the increased offer "represents a significant uplift to both the original Allied Power cash offer of 157p per share and the Pentair cash offer of 170p per share" and that the board was therefore recommending the offer.

Richard Sim, chairman and chief executive of Allied Power, said he was delighted Vero's board had recommended the offer. "APW strongly believes that the acquisition of Vero will create significant value, as Vero will both receive benefits from and provide benefits to Allied Power's custom electronic enclosure and Wright Line businesses," he said.