How Osmond gatecrashed the party

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"ALLIED HAS tons and tons of shitty pubs in great sites and it is crap at management." It is easy to see why Sir Christopher Hogg, the urbane chairman of Allied Domecq, has never exactly warmed to Punch chairman Hugh Osmond.

Harder to fathom, however, has been the Allied board's bulldog determination to stick with Whitbread's offer for its pubs estate as it became clear that the Punch deal was financially superior and largely free from regulatory uncertainty.

Mr Osmond had already christened Sir Christopher the "King Canute" of the pub world.

On the day that the Allied board rejected his latest increased offer, the Punch chairman observed, in his familiar earthy language: "This is not about value, it is about arse-covering because they are worried about being sued."

This is the sort of cut and thrust that has made the punch-up between Mr Osmond and Whitbread the most colourful City takeover battle since Granada swooped on Forte.

As contested bids go, this one has pretty much had everything: old money against new, and the upstart pitting his wits against one of the oldest members of the "beerage".

In one corner, a 37-year old entrepreneur who read medicine at Oxford but made his fortune in the City from My Kinda Town and Pizza Express.

In the other corner, two of the grandees of the Square Mile, in the shape of Sir Christopher and Sir Michael Angus, the chairman of Whitbread.

But, best of all, this has been a battle without rules. Because the two bidders are only trying to buy part of Allied Domecq, not the whole company, they have not had to observe the Takeover Code.

Thus Whitbread was solemnly able to declare one day that it had no intention whatsoever of raising its bid and then upping it by pounds 400m the next.

Then there are the full-page advertisements for the two protagonists, a tactic reminiscent of Ernest Saunders' great battle with Argyll's Jimmy Gulliver for control of Distillers.

Virtually lost in this blizzard of claim and counter-claim has been any serious analysis of who is best suited to own Allied's 3,500 pubs.

Punch says it will turn them back into locals anyone would be proud to drink in and pours scorn on the fad for themed pubs, which would see Firkin and Scruffy Murphy's rubbing shoulders with Big Steak and Hogshead if Whitbread had got its way.

But above all, Mr Osmond and his main backer, the US corporate raider David Bonderman, are in this game to make money.

It would surprise no one to see the Allied estate being sold back in a few years' time for a fat profit to the institutions they are so assiduously courting now. That would be the ultimate punch line.