Breare tipped to abandon planned W&D bid

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The Independent Online

Speculation was growing yesterday that Botts & Company, the private investment group, may abandon its plans to launch a takeover of Wolverhampton & Dudley, the UK's biggest regional brewer.

Speculation was growing yesterday that Botts & Company, the private investment group, may abandon its plans to launch a takeover of Wolverhampton & Dudley, the UK's biggest regional brewer.

The little-known venture capital firm, together with Robert Breare, the leisure entrepreneur, have been stalking W&D since August. But following last week's announcement that Whitbread is selling the 3,000 outlets in its pubs and bars portfolio, and earlier indications that Bass and Scottish & Newcastle are putting a further 1,500 pubs on the market, Botts' interest in the sector appears to have widened.

Asked whether the talks with W&D were continuing, Mr Breare said: "We are looking at a broad range of opportunities." A spokesman for W&D declined to comment.

W&D shares yesterday closed down 7.8 per cent at 392.5p. They have fallen by 57.5p since last Thursday.

Nigel Popham, an analyst at Teather & Greenwood, said: "It looks as if this bid is not going to happen.... The stock market is seldom wrong and these shares have been going down all week."

Graeme Eadie, at Deutsche Bank, said: "Botts does now have some other alternatives, which could put the skids under this bid ... but I still think that it will go ahead at the £5 level, not much more."

A third analyst suggested that Botts and Mr Breare could be hoping for a further slide in the W&D share price in order to acquire the business at the lowest possible price.

W&D announced that it was open to offers this month, having previously rebuffed an indicative 500p-a-share offer from the Botts team.

No other bidders have emerged to declare their interest in the company publicly and a rumoured management buyout has so far failed to materialise.

Wolverhampton & Dudley's shares had underperformed the sector by about 35 per cent this year before news of a possible takeover emerged in August. The brewing group became vulnerable to a bid in May after it suffered a temporary slump in profit margins due to over-aggressive price discounting.

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