It had the unusual effect yesterday of cutting the price of the bid target and boosting that of the bidder. Macallan's shares slumped 29p to 158p, while Highland's rose 3p to 374p.
The two bidders already have a close relationship with Macallan, a key supplier of "fillings" or ingredients for the Famous Grouse and whiskies produced by Suntory's Morrison Bowmore Distillers subsidiary.
Together they control 51 per cent of Macallan and are mounting the bid through a new joint venture company, HS Distillers, which could give Highland control of up to 75 per cent of Macallan. Maximum consideration under the offer would be pounds 88m.
It represents the first hostile move on a Scotch whisky group since Whyte & Mackay's initially unsuccessful move on Invergordon Distillers in 1991. As such it will ruffle the feathers of the highly incestuous industry more than usual.
Macallan's executive chairman, Allan Shiach, refused to comment before a board meeting to discuss the bid today. He said: "We have had friendly commercial dealings with Highland for a very long time and prior to that with Robertson & Baxter [one of Highland's associated companies]."
However, Macallan's management has made it clear in the past that it would not welcome a bid from Highland. Crucial to the outcome of the bid will be the attitude of the Harbinson and Shiach families, which control around 20 per cent of Macallan, of which the chairman is a scion.
Alan Gray, an analyst with Edinburgh brokers Sutherland and Partners, reckons they will be disappointed by Highland's offer and could be reluctant to accept. "I believe Macallan is a good company. It is poised for profits growth and has good potential. I believe you could say it is the jewel in the Scottish whisky crown...I believe Highland will need to pay a full price for that."
If the family saw profits moving forward at Macallan, they could decide to sit it out for a year or more, he said, which could be messy for Highland.
Brian Ivory, Highland's chief executive, described the offer as full, fair and generous, representing an exit price/earnings multiple of 31 times historic earnings. He described Macallan as a "superb" malt whisky, which is number four in the world by volume but in esteem closer to number one.
The bid "adds what is arguably the very best malt whisky to what is arguably the very best blended whisky".
There would be significant cost savings from eliminating Macallan's head office costs and a decision to merge the distiller's Speyside base with that of the existing Highland Malt Distilling subsidiary, currently situated in Glasgow.Reuse content