Henlys plays on 'commercial risks'

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HENLYS yesterday stepped up its campaign to remain independent with a defence document that highlighted what it called 'commercial risks' should T Cowie succeed with its pounds 32m all-share takeover bid.

The car dealer and maker of heavy vehicles also dismissed an attack made on Thursday by David Matthews, the company's former chairman and chief executive, and largest shareholder with 7 per cent.

Robert Wood, Henlys' chief executive, said that on 10 July Mr Matthews had said the Cowie offer undervalued Henlys materially, 'but here we are now with Cowie offering 6p more per share and he's changed his mind. What's his agenda?'

Mr Matthews' declared interest in buying the company's heavy vehicle operations met with similar disdain.

'Never at any time has he made an approach since he left nine- and-a-half months ago. I can see why he's interested, we've done a fine damm job in turning it round. But it's not for sale,' Mr Wood said.

Turning to Cowie, Mr Wood said that some car manufacturers were worried that an enlarged group would clash with franchising rules, leading to the forced sale of four or five outlets.

'If Cowie's 20 (dealerships) and Henlys 24 were put together there would not be 44 remaining. This is a classic one-on-one that does not come to two.'

He also warned that Henlys' sales agreement struck recently with Volvo contained a change of control clause. 'If they don't like the new ownership then they can walk away.'

Gordon Hodgson, chief executive of Cowie, said Henlys' defence document 'is an act of desperation by desperate men'.

A spokesman for Cowie, which is aware of the Volvo clause, added that Henlys had added 'absolutely nothing to what it said in its document on 10 August before we revised our offer.

'We continue to offer an uplift in income of 45 per cent, and an uplift in capital of well over 40 per cent. Our offer is worth 85p per share, while their share price is 70p. It seems a fairly clear-cut choice for shareholders.'

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