and JOHN SHEPHERD
Greenalls Group is poised to buy rival pub business Boddington for around pounds 500m as consolidation in the overcrowded pubs market gathers pace.
Earlier in the day Boddington admitted it had received an approach which might lead to a recommended offer. Industry sources said that Greenalls, the acquisitive group headed by Peter Greenall, will offer Boddington's shareholders one share worth 450p for every two they own, or a mixture of shares and cash. Yesterday morning the market sensed a bid was in the air, with many speculating it would be the brewer Whitbread, whose shares ended 7p down at 629p.
Boddington's shares soared 86p to 358p, well above the year's high of 295p. Some analysts said Greenalls would have to offer the equivalent of at least 400p a share to secure agreement from Boddington.
The Manchester company owns 450 pubs and sold the Boddington's beer brand - "the cream of Manchester" - to Whitbread seven years ago. The company has also developed a series of leisure villages, owns the drinks wholesalers chain Liquid Assets, and runs several nursing homes.
Boddington was forced into making a formal announcement as its share price soared amid heavy dealings for what is a tightly-held stock. It said any bid would be substantially above the markert price.
Dealers reported heavy interest in the stock from investors in Boddington's home area in the North West, where the highly acquisitive Greenalls Group is also based.
"There has been some pretty inspirational buying of Boddington's shares the past few days," one senior dealer said yesterday. "The thinking is that the buying may be more than just inspirational," he added. More than 3 million Boddington shares were traded on Tuesday, compared with just 34,953 on Monday and a 200-day average volume of 300,901. Another 2.7 million were traded yesterday.
The Greenall family sold out of Greenalls several years ago, but Peter Greenall stays at the helm. Like Boddington it has spearheaded the development of family pubs, with the "Jungle Bungles" chain. It also owns Cellar 5 off-licences, drinks wholesalers and De Vere hotels
The City still expects thousands of pubs to close, and further mergers are expected. Regent Inns recently bid for Newt & Cucumber pubs but was trumped by Morland, the Abingdon brewer. There was speculation yesterday about a number of possible deals: Vaux, the brewer and Swallow Hotels owner based in Sunderland, may be targeted by Wolverhampton & Dudley Breweries. Analysts also expect that if Whitbread cannot buy Allied Domecq out of Carlsberg-Tetley then it might go for Greene King's brewing arm instead.
Carlsberg-Tetley is to close its Warrington brewery by October 1996 with the loss of 240 jobs; 150 will go at Burton on Trent and another 110 will go in sales and administration.