Granada set to give ground on Savoy sale

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The Independent Online
THE SALE of Savoy Group, the upmarket hotelier, could still go ahead despite resistance from some members of the Wontner family, which owns a substantial stake in the group.

Granada, the media and leisure giant, is preparing to cave in to pressure from the Wontners and give them a bigger share of the spoils in order to save the deal.

Gerry Robinson, Granada's chairman, had been willing to dig his heels in over the relative valuations put on the Savoy's B shares, which command more voting rights, and the lower-voting A shares.

Granada owns 68 per cent of the A shares but only 42 per cent of the voting rights. Mr Robinson had wanted to see the B shares valued at about two times the A shares. However advisers working on behalf of the family trusts wanted the Bs valued at six to seven times the As.

Now Mr Robinson is willing to return to the negotiating table and meet the family half way, according to industry sources, which could lead to the Bs being valued at around four to five times the Bs

If the two sides can thrash out a deal it will greatly enhance the chances of a sale, with bidders already lining up to buy the group.

Lady Wontner, whose agreement is crucial to any deal, has previously expressed reservations about a sale. However, she is understood to be willing to go ahead with the deal as long as the family can achieve what it deemed to be a fair share of the proceeds.

Other family members, including Julian Wontner and his brother Giles, have reportedly spoken out against the deal. Nevertheless the final decision deal lies with the trustees of the family and charitable holdings, who could still press ahead with a sale despite a split within the Wontner clan.

Blackstone, the New York based investment bank, is still the front-runner to buy the Savoy, which also owns the Berkeley, the Connaught and Claridge's. It has indicated it is willing to pay pounds 520m for the group and has teamed up with Bill Johnson, former chief executive of the Ritz-Carlton hotel chain

Negotiations are continuing and centre on whether the bid for the group should include or exclude the millions of pounds the group plans to pay out in dividends. The Savoy A shares rose 10p to 1675p yesterday on renewed hopes of a sale.

Blackstone has yet to table a firm offer or embark on due diligence of the Savoy group. This could be a long drawn out process. Any sale will also have to be agreed at an extraordinary general meeting.