M&G throws BET a lifeline by rejecting Rentokil offer

M&G, the fund management group, has thrown a lifeline to BET by publicly rejecting the pounds 2bn unwanted offer from rival business services group Rentokil. The vote of confidence from its biggest shareholder has raised hopes in the BET camp that it can fend off the bid by the final closing date on Friday.

M&G is thought to have already attempted to broker an agreed deal between the two sides. In a letter to Sir Christopher Harding, BET chairman, the fund management group praised chief executive John Clark's success over the past few years in rescuing BET from its "parlous" state in 1991.

"Some commentators regard the `rescue' aspect of managing poorly performing companies as a comparatively easy part of the job. John has not only accomplished this most successfully, but has also been consistent in setting out his plans for the future and is delivering results in line with these strategies.

"We see his future involvement at BET as a key issue and were reassured to hear at the meeting he intends to stay with the company for some time."

M&G "has little difficulty in supporting the board of BET and will, therefore, not be accepting the current bid from Rentokil."

Nigel Morrison, an M&G fund manager, said Rentokil's bid was too low. "We have a high regard for Rentokil's management, but unfortunately they were not prepared to pay quite enough."

Rentokil was quick to downplay the M&G move. Charles Grimaldi, director of corporate affairs, said: "As far as we know, historically they always support the existing management."

Some City fund managers agreed that M&G's stance was no surprise. One said: "It is very much M&G's style. It is very much their public attitude to hostile takeovers [to support incumbent managements], so I don't think you will find anyone anywhere remotely surprised by their attitude."

But others pointed to the unusually public nature of M&G's support for the BET management. One large shareholder in the group who did not want to be named said: "I was surprised by the strength of M&G's public view on this. I thought [the bid] was dying a death and I think this will make people take a long and hard look at this. I think [the outcome] is finely balanced now."

A supporter of the BET management, he said he sympathised with the sentiments expressed by M&G. The bid had misrepresented the situation concering BET. "It has been portrayed as a lame duck company, which would have been accurate some years ago, but is pretty wide of the mark now." Mr Clark had a coherent strategy and had salvaged quite a bit of shareholder value over the past three years, he said.

Another big institutional shareholder which has not yet made up its mind about the bid agreed that Rentokil had by no means won the day. "It looks quite close. Thompson is a man with a record which looks quite good, but Clark's got a case. It's one of those cases where one has to think quite hard."

BET's shares fell 3p to 202.5p, 10p below the value implied by Rentokil's offer after the bidder's shares also dipped 3p to 352p yesterday.

Analysts said the latest development would strengthen the hand of Mr Clark, who is in the midst of a round of institutional visits. A spokesman said he still had to see about a third of the shareholders.

However, many observers still believethat Rentokil will win the day as institutions continue to bale out of BET.

Start your day with The Independent, sign up for daily news emails
ebooksA celebration of British elections
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Editor-in-chief - Financial Services - City, London

£60000 - £70000 per annum + benefits : Ashdown Group: A highly successful, glo...

Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Guru Careers: Management Accountant

£27 - 35k + Bonus + Benefits: Guru Careers: A Management Accountant is needed ...

Guru Careers: Project Manager / Business Analyst

£40-50k + Benefits.: Guru Careers: A Project Manager / Business Analyst is nee...

Day In a Page

General Election 2015: ‘We will not sit down with Nicola Sturgeon’, says Ed Balls

'We will not sit down with Nicola Sturgeon'

In an exclusive interview, Ed Balls says he won't negotiate his first Budget with SNP MPs - even if Labour need their votes to secure its passage
VE Day 70th anniversary: How ordinary Britons celebrated the end of war in Europe

How ordinary Britons celebrated VE Day

Our perception of VE Day usually involves crowds of giddy Britons casting off the shackles of war with gay abandon. The truth was more nuanced
They came in with William Caxton's printing press, but typefaces still matter in the digital age

Typefaces still matter in the digital age

A new typeface once took years to create, now thousands are available at the click of a drop-down menu. So why do most of us still rely on the old classics, asks Meg Carter?
Discovery of 'missing link' between the two main life-forms on Earth could explain evolution of animals, say scientists

'Missing link' between Earth's two life-forms found

New microbial species tells us something about our dark past, say scientists
The Pan Am Experience is a 'flight' back to the 1970s that never takes off - at least, not literally

Pan Am Experience: A 'flight' back to the 70s

Tim Walker checks in and checks out a four-hour journey with a difference
Humans aren't alone in indulging in politics - it's everywhere in the animal world

Humans aren't alone in indulging in politics

Voting, mutual back-scratching, coups and charismatic leaders - it's everywhere in the animal world
Crisp sales are in decline - but this tasty trivia might tempt back the turncoats

Crisp sales are in decline

As a nation we're filling up on popcorn and pitta chips and forsaking their potato-based predecessors
Ronald McDonald the muse? Why Banksy, Ron English and Keith Coventry are lovin' Maccy D's

Ronald McDonald the muse

A new wave of artists is taking inspiration from the fast food chain
13 best picnic blankets

13 best picnic blankets

Dine al fresco without the grass stains and damp bottoms with something from our pick of picnic rugs
Barcelona 3 Bayern Munich 0 player ratings: Lionel Messi scores twice - but does he score highest in our ratings?

Barcelona vs Bayern Munich player ratings

Lionel Messi scores twice - but does he score highest in our ratings?
Martin Guptill: Explosive New Zealand batsman who sets the range for Kiwis' big guns

Explosive batsman who sets the range for Kiwis' big guns

Martin Guptill has smashed early runs for Derbyshire and tells Richard Edwards to expect more from the 'freakish' Brendon McCullum and his buoyant team during their tour of England
General Election 2015: Ed Miliband's unlikely journey from hapless geek to heart-throb

Miliband's unlikely journey from hapless geek to heart-throb

He was meant to be Labour's biggest handicap - but has become almost an asset
General Election 2015: A guide to the smaller parties, from the the National Health Action Party to the Church of the Militant Elvis Party

On the margins

From Militant Elvis to Women's Equality: a guide to the underdogs standing in the election
Amr Darrag: Ex-Muslim Brotherhood minister in exile still believes Egypt's military regime can be replaced with 'moderate' Islamic rule

'This is the battle of young Egypt for the future of our country'

Ex-Muslim Brotherhood minister Amr Darrag still believes the opposition can rid Egypt of its military regime and replace it with 'moderate' Islamic rule, he tells Robert Fisk
Why patients must rely less on doctors: Improving our own health is the 'blockbuster drug of the century'

Why patients must rely less on doctors

Improving our own health is the 'blockbuster drug of the century'