Cassell spurns MacMillan

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CASSELL, the publisher behind titles ranging from Nick Hornby's Fever Pitch to the Catechism of the Catholic church, looked set to lose its independence yesterday as rival publisher MacMillan launched a hostile takeover bid.

MacMillan is offering 100p per Cassell share - more than double the company's closing share price of 45p Friday. The shares promptly soared to 97.5p.

Cassell rejected the bid, arguing that the offer "does not reflect the underlying value of Cassell's publishing assets".

However, its chances of fighting off the bid looked slim after MacMillan disclosed that it had bought 14.9 per cent of Cassell's share capital in the market. Meanwhile, six shareholders representing a further 49 per cent of the shares have accepted the offer provided that a higher bid does not emerge.

Although privately owned, MacMillan is much larger than Cassell and has well-known imprints such as Pan and Picador. Its latest coup was to publish the memoirs of Chris Patten, the former Hong Kong governor, after they were turned down by Rupert Murdoch's HarperCollins.

In the year to December 1996 - the last for which accounts are available - MacMillan's parent, HM Publishers, reported a profit after tax of pounds 16.4m on turnover of pounds 293.6m.

MacMillan first approached its target a few months ago with a lower offer, rejected by Cassell's board. It then approached the group's major shareholders, securing their approval before launching the bid early yesterday morning. Cassell shares have been hit by the market upheaval, plunging from almost 80p in August.

Cassell also publishes fantasy writer Terry Pratchett's back catalogue, and is known for its dictionaries and Brewer's reference books.

Cassell said it would be "exploring all its options to ensure that shareholder value is maximised". The group is expected to try to find another publisher or financial backer willing to pay a higher price.