Forte rubbishes Granada bid 'farce'

Sir Rocco claims Robinson 'does not believe in style or service'

SIR ROCCO FORTE yesterday called Granada's bid for the Forte hotel and restaurant group "a farce". Sir Rocco said Gerry Robinson, chief executive of Granada, was a corporate raider interested only in sucking the group dry before moving on to another target. Granada, he complained, had no long-term strategy: "He's a milker of businesses, not a builder of businesses. He has to keep buying things to keep going."

He said Mr Robinson had no concept of quality, service or style: "Robinson doesn't have one quality business in his portfolio. He doesn't talk about style and service - he doesn't believe in them - which is why he's such an inappropriate person to run this business."

Sir Rocco's outspoken re-marks contrast sharply with the carefully crafted criticisms of Mr Robinson. Although he has not directly attacked Sir Rocco, the Granada boss's charges that Forte has been poorly managed clearly hit home. In the offer document he chastised Forte for having a "misguided strategy", missing its performance targets, and "failing to exploit good brands". Forte, shareholders were told, "has lost credibility and forfeited the right to count on your support". The subtle portrayal of Sir Rocco as a toff, ignoring his humble origins as the grandson of an Italian immigrant, also must have hurt.

Mr Robinson said he was astonished by Sir Rocco's criticisms. "It's just wrong," he said of the corporate raider charge. "I've never been at a business for less than eight or nine years."

Sir Rocco defended his own performance, pointing in particular to recent jumps in pre-tax profit and a youthful new management team. Many of the ideas put forward by Mr Robinson he claims as his own, such as the flotation of the Alpha Airports Group.

The figures in the offer document, however, show that compared with the FTA All-Share Index, Forte's stock has been falling, or at best static, for five years while Granada has soared. Mr Robinson cites the return on a pounds 100 investment made in late 1990. At Forte it would, by now, have gained pounds 30. At Granada, pounds 444. The defence against such comparisons is that the baseline is just prior to the recession and Gulf War crisis that devastated the leisure industry.

Such vitriol early in the bid battle seems likely to signal a dirty, no-holds-barred scrap. The first battlefield, being approached from both sides next week, is the Council of Forte, the trust that holds a controlling block of votes. Mr Robinson wants them to remain neutral. Sir Rocco will not say what he will ask of them.

Whichever way the council goes, the Takeover Panel will have the final say. During the last bid for Forte, in 1971, it decided that the council's heavily weighted trust shares would not count towards acceptance. But in that case both the Council and Forte's board agreed.

If the council's trust shares are discounted, remaining shareholders suddenly become significant. The largest is Mercury Asset Management with 12.5 per cent. It also owns almost 15 per cent of Granada. The reasons it built up the two stakes are quite different, and not encouraging for Sir Rocco. Forte was bought because MAM thought the property portfolio attractively priced. It invested in Granada because it believed in Mr Robinson. Faced with a similar situation during the Granada bid for LWT two years ago, it sold.

If successful, Granada says it will rejuvenate Forte's roadside restaurants, push the mid-market Meridien hotel brand and rationalise budget inns under the Posthouse and Travelodge names. It also plans to sell Lillywhites, the remaining Alpha stake, the Welcome Break motorway service stations and its stake in the Savoy Group. Among possible buyers for the service stations is the drinks group Whitbread.

Profile, page 5

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Marketing Manager - B2B, Corporate - City, London

£45000 - £50000 per annum + benefits : Ashdown Group: A highly successful, glo...

Neil Pavier: Commercial Analyst

£50,000 - £55,000: Neil Pavier: Are you a professionally qualified commercial ...

Loren Hughes: Financial Accountant

£45,000 - £55,000: Loren Hughes: Are you looking for a new opportunity that wi...

Sheridan Maine: Finance Analyst

Circa £45,000-£50,000 + benefits: Sheridan Maine: Are you a newly qualified ac...

Day In a Page

General Election 2015: The masterminds behind the scenes

The masterminds behind the election

How do you get your party leader to embrace a message and then stick to it? By employing these people
Machine Gun America: The amusement park where teenagers go to shoot a huge range of automatic weapons

Machine Gun America

The amusement park where teenagers go to shoot a huge range of automatic weapons
The ethics of pet food: Why are we are so selective in how we show animals our love?

The ethics of pet food

Why are we are so selective in how we show animals our love?
How Tansy Davies turned 9/11 into her opera 'Between Worlds'

How a composer turned 9/11 into her opera 'Between Worlds'

Tansy Davies makes her operatic debut with a work about the attack on the Twin Towers. Despite the topic, she says it is a life-affirming piece
11 best bedside tables

11 best bedside tables

It could be the first thing you see in the morning, so make it work for you. We find night stands, tables and cabinets to wake up to
Italy vs England player ratings: Did Andros Townsend's goal see him beat Harry Kane and Wayne Rooney to top marks?

Italy vs England player ratings

Did Townsend's goal see him beat Kane and Rooney to top marks?
Danny Higginbotham: An underdog's tale of making the most of it

An underdog's tale of making the most of it

Danny Higginbotham on being let go by Manchester United, annoying Gordon Strachan, utilising his talents to the full at Stoke and plunging into the world of analysis
Audley Harrison's abusers forget the debt he's due, but Errol Christie will always remember what he owes the police

Steve Bunce: Inside Boxing

Audley Harrison's abusers forget the debt he's due, but Errol Christie will always remember what he owes the police
No postcode? No vote

Floating voters

How living on a houseboat meant I didn't officially 'exist'
Louis Theroux's affable Englishman routine begins to wear thin

By Reason of Insanity

Louis Theroux's affable Englishman routine begins to wear thin
Power dressing is back – but no shoulderpads!

Power dressing is back

But banish all thoughts of Eighties shoulderpads
Spanish stone-age cave paintings 'under threat' after being re-opened to the public

Spanish stone-age cave paintings in Altamira 'under threat'

Caves were re-opened to the public
'I was the bookies’ favourite to be first to leave the Cabinet'

Vince Cable interview

'I was the bookies’ favourite to be first to leave the Cabinet'
Election 2015: How many of the Government's coalition agreement promises have been kept?

Promises, promises

But how many coalition agreement pledges have been kept?
The Gaza fisherman who built his own reef - and was shot dead there by an Israeli gunboat

The death of a Gaza fisherman

He built his own reef, and was fatally shot there by an Israeli gunboat