Hartwell adds 2.5p to Trimoco offer price

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The Independent Online
HARTWELL yesterday raised the stakes in its bid for Trimoco, simultaneously lifting its takeover terms and raiding the stock market in the afternoon for shares in the rival car dealer.

The bid has been increased from 17.5p to 20p cash per share, valuing Trimoco at nearly pounds 30m. Some 3.8 million shares were bought in the market, taking Hartwell's stake to 42 per cent.

Hartwell's action in effect ruled out the possibility of a 'white knight' bid for Trimoco.

Recent speculation had centred on T Cowie, which has a 4.6 per cent shareholding and has admitted it has looked closely at the situation.

Gordon Hodgson, chief executive of Cowie, which on Tuesday lost its pounds 32m takeover fight for Henlys, said: 'Hartwell won't be buying our shares at that price.

'Trimoco has a 22p net asset value and there is 6p a share in the pension fund. We are talking a value of 28p.'

There was a muted response from Trimoco, which stated: 'The board of Trimoco notes the announcement by Hartwell that it has increased its offer. The board will make a further announcement in due course.'

The statement was viewed by some as tantamount to capitulation. Roger Smith, chief executive of Trimoco, which principally trades through eight Ford dealerships, was not available for comment.

Hartwell, owned by the Jameel family of Saudi Arabia and the third-largest car dealer in Britain with 40 outlets, was last month forced into making a mandatory bid because its shareholding rose above 30 per cent.

Yesterday John Wei, chairman and chief executive, denied rumours that the possibility of a rival bid by T Cowie had forced Hartwell's hand.

'We were disappointed that our mandatory offers were so negatively received by the board of Trimoco,' he said.

'We believe the present situation is detrimental to the best interests of Trimoco's customers, suppliers, employees and shareholders . . . and we have therefore taken decisive action.'

Hartwell said its revised offer represented a multiple of 29.9 times Trimoco's earnings per share for the 12 months to the end of this month.

The multiple was calculated by lumping together Trimoco's second-half results for 1991/92 and the likely result of pounds 1.2m before tax for the current six-month period, which ends this month.

The offer also represents an increase in capital value of 14.3 per cent over Trimoco's share price on 4 August, the day the original offer was announced. Trimoco's shares yesterday closed 1p higher at 20.5p.