Hilton ups the ante for control of ITT

The battle for control of ITT Corporation was re-ignited yesterday when Hilton Hotels Corporation announced that it was significantly increasing the value of its hostile bid for the group to a sky-high $70 a share.

The manoeuvre, ordered by Hilton's combative chief executive, Stephen Bollenbach, represents one more attempt at overcoming the various defensive moves adopted by ITT in recent weeks aimed at defeating the bid.

The proposed stock and cash transaction has a value of $8.3bn (pounds 5.3bn) which grows to $11.5bn once assumption of ITT debt is taken into account. At that level, it would represent a 64 per cent premium over ITT's trading price when Hilton made its first move with a $55-a-share bid in January.

The bid's chances seemed to fade somewhat over recent weeks, notably after ITT announced last month that it was splitting itself into three and initiating a stock buy-back. Previously, ITT moved to sell some of its hotels that it believed were most attractive to Hilton in the first place.

The new Hilton pitch is likely to reinvigorate the struggle, however, as many ITT shareholders consider the latest offer on the table. If successful, the takeover would create a Goliath in the hotel, gambling and entertainment industry.

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