Goldsborough boss buys shares as bid fails
Wednesday 17 July 1996
Mr Smith's purchases, which take his holding to 3.4 per cent, were accompanied by his merchant banking advisers SBC Warburg. The bank spent pounds 2.7m at the same 150p-a-share price to take a 4.1 per cent stake in the group.
The buying came as the bidder announced that by yesterday's close it had received acceptances covering 40.97 per cent of Goldsborough's shares, well short of the 50 per cent required, causing the bid to lapse.
Westminster's shares ended up 3p at 298p, while Goldsborough's fell 3p to 145p. At yesterday's price, the 54-for-100 share offer valued Goldsborough at just short of 161p, compared with a cash alternative of 156.6p.
The failure of the bid is surprising, given that the shares have never risen above the 170p at which they were floated just over two years ago. There were suggestions yesterday that institutions were registering their dissatisfaction at the imposition of a truncated 21-day bid timetable by SBC Warburg.
One source said: "The institutions don't want people to get away with this. Suddenly in the last few days this has come up again and again."
The 21-day timetable was also a factor in Amec's escape from the Norwegian group Kvaerner earlier this year, despite years of underperformance at the group.
Pat Carter, Westminster's chief executive, described the failure of the bid as disappointing, but said consolidation in the industry would continue.
Graham Smith, Mr Carter's opposite number at Goldsborough, said: "I think we won the argument that this was not an issue of consolidation but of diversification."
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