A spokesman for International Paper said the company would accuse Holvis of not acting in good faith, and of ignoring the best interests of its shareholders.
The fight for Holvis, the Swiss distribution and non-woven textile group, neared a climax on Friday as the industrial group BBA, led by chairman Bob Quarta, made an eleventh-hour, pounds 247m bid for Holvis with a pounds 132m side- deal for Fiberweb, Holvis's non-woven division.
Holvis and BBA signed a lock-out deal preventing any other bidder from winning Fiberweb whatever the size of its bid for the entire company.
The move countered an earlier, hostile pounds 211m (Sfr435-a-share) offer from International Paper and its UK ally, Arjo Wiggins Appleton, for both Fiberweb and Muhlebach, the paper distribution arm. BBA's share price shot up 17.5p to 235.5p at the deal's announcement.
IP has offered to increase its bid to Sfr550 a share for both divisions, topping BBA's Sfr500 bid, on condition that the lock-out deal is dissolved. Even so, BBA still gets Fiberweb under the terms of the side deal.
Rudolph Wenger, chief financial officer at Holvis, told the Independent that "the board feels secure and confident that the deal is legally binding. The board sticks with its belief that the deal with BBA is watertight".
Lock-out deals, such as the BBA bid, are illegal in the UK in a contested takeover. Under Swiss law, however, it is possible for a board of directors to sell assets without shareholder approval, although new rules that come into effect next year will ban such lock-out deals.
The new rules reflect the fact that even the Swiss corporate sector is finding it hard to avoid the rough-and-tumble tactics associated with mergers and acquisitions elsewhere. Despite the involvement of Swiss firms in hostile bids outside their territory - notably Nestle's bid for Rowntree in 1988 - mergers at home have always been accomplished without contention.
Proof that even the tone, and not just legal manoeuvrings associated with takeovers has sharpened, Milan Turk, IP senior vice-president, sent a letter to the Holvis board yesterday, accusing it of failing to maximise shareholder value in the BBA lock-up deal. IP also sent a letter to all Holvis shareholders asking for an extraordinary meeting to discuss the issues. Mr Turk said IP was reviewing all its options, including the possibility of taking legal action.
The acquisition of Fiberweb would make BBA the third- biggest non-woven textile company in the world.
Timetable of the bid
Monday 24 April: International Paper buys Mercury Asset Management's 25 per cent stake in Holvis to launch SFr435 per share hostile takeover bid.
Friday 5 May: InterTech, a private US company and Arjo Wiggins Appleton, make pounds 234m counter-bid.
Tuesday 23 May: InterTech drops out of bidding as Arjo switches allegiance to International Paper.
International Paper and Arjo launch Sfr435 a share offer under which IP will sell Muhlebach, the paper distribution division, to Arjo.
Thursday 25 May: IP indicates it would raise offer to Sfr480 per share. Holvis did not react at the time, but says now that the increased bid was not comparable to BBA's forthcoming offer.
Friday 26 May: BBA announces pounds 247m, eleventh-hour counter-bid for Holvis with lock-in deal of pounds 132m for Fiberweb. Secures blessing of Holvis board.
Monday 29 May: IP announces it will raise offer to Sfr550 per share on condition that the BBA/Fiberweb lock-up deal is dissolved. Meeting at Swiss Takeover Panel scheduled for 31 May.