McLeod in 14.3m pounds hostile bid for Wheway

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The Independent Online
MCLEOD RUSSELL launched a pounds 14.3m hostile bid for Wheway yesterday, marking an acrimonious turn to the on-off love affair between the paint company and its air-conditioner-making target.

Talks between the two companies started in September but were called off in December, with both parties saying they could not agree on a price.

Nigel Openshaw, chairman of McLeod Russell, said yesterday: 'Wheway has played very hard to get and refused to give us up-to- date information. We feel we are a white knight for shareholders and hope very much that this will concentrate the mind and the Wheway board will recommend the offer.'

Hugh Ashton, Wheway's chairman, would not rule out a recommendation. 'We are in low waters, let's not pretend otherwise, but it is simply not true that we have been slow with information. They know all there is to know about the company.'

In the year to September Wheway made a pre-tax loss of pounds 3.5m after a pounds 2.8m profit in 1991. Its report and accounts were qualified on a going concern basis by the auditors Price Waterhouse, and within the past two weeks its chief executive, John McGowan, who built the company up through a string of acquisitions in the late 1980s, left the board.

McLeod is offering one of its own shares for 10 of Wheway's, giving Wheway shareholders 23 per cent of the enlarged group. With McLeod Russell's shares 2p off at 100p, the offer values Wheway, up 1.5p to 9p, at 10p a share.

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