Granada may face DTI quiz on bid document

MATHEW HORSMAN

Granada last night faced possible action by the Department of Trade and Industry as the clock ticked down to today's 1pm deadline for its pounds 3.9bn bid for Forte.

The DTI is prepared to consider evidence that Granada misled shareholders by publicly understating its asset disposal programme in its original offer document, according to an answer to a written question by Luton North MP John Carlisle.

The issue relates to Granada's promise, detailed in the offer document, to "capitalise on the Meridien brand" if its bid succeeded. But by the time an increased offer was unveiled six weeks later, Granada had decided to sell the hotels outright.

Pointing to comments by Gerry Robinson, Granada's chief executive, that appeared in the Independent earlier this month, Forte suggested Granada had intended all along to sell the hotels.

In the article, published on 10 January, Mr Robinson is quoted as saying: ''We downplayed our intentions because we were bloody nervous that Forte might paint us as asset strippers."

A Granada insider said: "This is of huge unimportance. Clearly, this is the result of a planted question."

Any action by the DTI would come long after shareholders cast their bids today.

Success for Granada would mark the end of a UK hotels dynasty, and the beginning of a radical restructuring of the hotels and restaurants business where Forte had made its name.

"It may be close, but Granada must look like winning," one analyst said.

A Granada spokesman said the company was "quietly confident", following several days of meetings with insitutions and telephone talks with private investors over the weekend.

A Forte spokesman disputed the consensus view in the City, claiming that the outcome was going to be "very, very close".

He added: "Shareholders have waited until the very last moment to make a decision, suggesting there is still a lot to play for."

Mercury Asset Management, which holds 14.1 per cent of Forte, is tipped to tender its shares to Granada, although the investment fund's chief strategist, vice-chairman Carol Galley, had no comment yesterday.

Meanwhile, Whitbread held its much-trailed meeting with MAM yesterday, in an effort to convince Ms Galley to back Forte's independence.

If Forte sees off the bid, Whitbread will pay pounds 1.05bn for the Little Chef and Happy Eater roadside restaurants, the Welcome Break motorway service centres and Forte's Travelodge budget hotels.