Lloyds bidders set for final fight
Monday 02 December 1996
Under City takeover rules, the German group has until tomorrow to issue the document to Lloyds shareholders, triggering the 60-day timetable within which the bid must be completed. If it runs anywhere near to the wire, the tussle for Lloyds will have been going on for over a year.
The offer document will come hot on the heels of the first indication from rival bidder UniChem of the level of interest its cash and shares offer has elicited from shareholders.
The Surrey-based wholesale and retail chemists group will today announce the level of acceptances at the first closing date for its bid. But observers expect few takers at this early stage of the proceedings.
Lloyds' shares on Friday stood unchanged at 513.5p, well clear of both bids. UniChem's terms of 1.6 shares plus 92.6p in cash valued its target at just over 490p, which is 10p less than the 500p all-cash offer from Gehe.
Most observers expect that one or both of the bidders will be forced to raise their terms to clinch the bid. Analysts expect Gehe to spin the bid timetable out as long as possible to put maximum pressure on UniChem, which faces difficulties if it wants to increase its offer.
The group is already straining its balance sheet with the bid at this level. Gehe claims its average gearing could soar to 490 per cent if it is successful, giving UniChem little room to manoeuvre to raise the cash element of its bid.
But increasing the amount of paper could prove counter-productive if, as some believe, the market pushes down the share price to take account of the resulting earnings dilution.
UniChem launched its original bid on 18 January this year and was quickly trumped by a higher offer from Gehe, one of Europe's biggest drugs wholesalers. The German firm has since hinted that the original offer may be too high, given Lloyds' relatively poor performance in the intervening period.
Both bids were kicked into touch for over seven months after they were referred to the Monopolies and Mergers Commission, which subsequently allowed both sides to renew their offers, subject to the sale of six or seven relatively minor wholesale depots.
- 1 Paris attacks: Do not call Charlie Hebdo killers 'terrorists', BBC says
- 2 Man who held up 'hire me' sign at Waterloo station returns a year later with 'I'm hiring' sign
- 3 UK weather: Snow to fall in the coming week with sub-zero temperatures to last until early February
- 4 Saudi preacher who 'raped and tortured' his five -year-old daughter to death is released after paying 'blood money'
- 5 The enemy within: People who hear voices in their heads are being encouraged to talk back
Paris attacks: Do not call Charlie Hebdo killers 'terrorists', BBC says
Rowan Atkinson to sell £10 million McLaren 'supercar' he crashed into a tree and a lamppost
UK weather: Snow to fall in the coming week with sub-zero temperatures to last until early February
Saudi preacher who 'raped and tortured' his five -year-old daughter to death is released after paying 'blood money'
Howard 'Mr Nice' Marks reveals he has inoperable cancer: 'I've had an incredible life'
Nigel Farage: NHS might have to be replaced by private health insurance
'We would evict Queen from Buckingham Palace and allocate her council house,' say Greens
French court convicts three over homophobic tweets, in case hailed as a 'significant victory' by LGBT rights campaigners
Greece elections: Syriza and EU on collision course after election win for left-wing party
George Galloway condemns 'racist, Islamophobic, hypocritical rag' Charlie Hebdo at freedom of speech rally
British Muslim school children suffering a backlash of abuse following Paris attacks
iJobs Money & Business
£30000 - £32000 per annum + benefits : Ashdown Group: A highly successful, int...
£18000 - £20000 per annum: Recruitment Genius: This rapidly expanding business...
£25 - 28k + Bonus: Guru Careers: An In-house / Internal Recruiter is needed to...
Negotiable: Recruitment Genius: A Tax Assistant is required to join a leading ...