Marks & Spencer rejects £8.4bn Green bid

Billionaire retailer offers 370p cash or paper * Board says offer still 'significantly undervalues' group

Marks & Spencer last night insisted it was "not for sale"' as it rejected a revised £8.4bn takeover proposal from Philip Green, which it says "significantly undervalued" the group.

The company revealed it had received a fresh 370p a share cash proposal "in relation to a possible offer" from Mr Green yesterday afternoon. Any offer would include a "partial equity alternative", it added.

Paul Myners, the M&S chairman, said the proposal, which came less than two weeks after Mr Green made his initial indicative offer, did not "fully reflect the value of the business or its prospects".

He added: "We have to commit to doing what we judge to be in the very best interests of our shareholders. But an offer of 370p simply is not at a level that we could recommend for representing good value... the business is not for sale."

The board's swift dismissal puts Mr Green back on the back foot. He would not disclose whether he was prepared to launch a hostile bid. Today his camp is likely to put pressure on M&S shareholders to lobby the retailer's board to reconsider Mr Green's approach.

Mr Green's camp has spent the past week sounding out M&S's biggest shareholders, including its three key US investors, about what level he would have to pitch his offer for them to take him seriously. However, several institutional investors, including Isis Asset Management, have said that they would not be prepared to consider any bid worth less than 400p a share. Analysts have valued M&S, the UK's biggest trophy retailer, as up to 450p per share.

M&S shares, which were trading at about 270p three weeks ago, had soared 13.5p to 370.5p earlier in the day on speculation that the Bhs owner was preparing a fresh bid before falling back to close up 6.5p at 363.5p.

Under the terms of the proposal Mr Green's personal equity injection would have soared by £500m to £1.1bn, while his financial backers HBOS, Goldman Sachs and Barclays would have lifted the amount of equity they are committing to the bid to £1.9bn collectively. He said he had raised committed financing of £10.4bn. Mr Green said any offer would hinge on limited due diligence. He repeated his request for further information about four key areas of M&S business, including the state of the retailer's pension fund and the details of its contracts with the per una designer, George Davies. "He wanted greater granularity ... on a number of areas," Mr Myners said.

Goldman Sachs, Mr Green's financial adviser, contacted M&S at midday yesterday with details of the proposal from Revival Acquisitions, the entrepreneur's bid vehicle. At about 4pm Mr Green met Mr Myners and Stuart Rose, the M&S chief executive, in Grosvenor Square. The M&S board convened shortly after to discuss the approach, which they took less than two hours to dismiss.

Asked how Mr Green reacted to the rejection, Mr Rose said: "Philip was very professional, as you would expect him to be. We had a telephone conversation and he listened."

M&S reiterated that Mr Rose and his team remained set to unveil their blueprint for restoring the company's fortunes next month, two days before its annual meeting. "I am confident that when we talk to you on 12 July we will be able to outline operational improvements which we think will demonstrate the value in the business," Mr Rose added.

He admitted the group had not sounded out its shareholders' views before rejecting the proposal, but said its advisors were in constant contact with them.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

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

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Sales Assistant / Buyer

£15000 - £17000 per annum: Recruitment Genius: This company offers a range of ...

Recruitment Genius: Customer Service Advisor

£15000 - £16000 per annum: Recruitment Genius: Customer Service Advisors are r...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45K: SThree: SThree were established in 1986....

Recruitment Genius: Compliance Manager

£40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...

Day In a Page

Greece debt crisis: What happened to democracy when it’s a case of 'Vote Yes or else'?

'The economic collapse has happened. What is at risk now is democracy...'

If it doesn’t work in Europe, how is it supposed to work in India or the Middle East, asks Robert Fisk
The science of swearing: What lies behind the use of four-letter words?

The science of swearing

What lies behind the use of four-letter words?
The Real Stories of Migrant Britain: Clive fled from Zimbabwe - now it won't have him back

The Real Stories of Migrant Britain

Clive fled from Zimbabwe - now it won’t have him back
Africa on the menu: Three foodie friends want to popularise dishes from the continent

Africa on the menu

Three foodie friends want to popularise dishes from the hot new continent
Donna Karan is stepping down after 30 years - so who will fill the DKNY creator's boots?

Who will fill Donna Karan's boots?

The designer is stepping down as Chief Designer of DKNY after 30 years. Alexander Fury looks back at the career of 'America's Chanel'
10 best statement lightbulbs

10 best statement lightbulbs

Dare to bare with some out-of-the-ordinary illumination
Wimbledon 2015: Heather Watson - 'I had Serena's poster on my wall – now I'm playing her'

Heather Watson: 'I had Serena's poster on my wall – now I'm playing her'

Briton pumped up for dream meeting with world No 1
Wimbledon 2015: Nick Bollettieri - It's time for big John Isner to produce the goods to go with his thumping serve

Nick Bollettieri's Wimbledon Files

It's time for big John Isner to produce the goods to go with his thumping serve
Dustin Brown: Who is the tennis player who knocked Rafael Nadal out of Wimbeldon 2015?

Dustin Brown

Who is the German player that knocked Nadal out of Wimbeldon 2015?
Ashes 2015: Damien Martyn - 'England are fired up again, just like in 2005...'

Damien Martyn: 'England are fired up again, just like in 2005...'

Australian veteran of that Ashes series, believes the hosts' may become unstoppable if they win the first Test
Tour de France 2015: Twins Simon and Adam Yates have a mountain to climb during Tour of duty

Twins have a mountain to climb during Tour of duty

Yates brothers will target the steepest sections in bid to win a stage in France
John Palmer: 'Goldfinger' of British crime was murdered, say police

Murder of the Brink’s-MAT mastermind

'Goldfinger' of British crime's life ended in a blaze of bullets, say police
Forget little green men - aliens will look like humans, says Cambridge University evolution expert

Forget little green men

Leading evolutionary biologist says aliens will look like humans
The Real Stories of Migrant Britain: An Algerian scientist adjusts to life working in a kebab shop

The Real Stories of Migrant Britain

An Algerian scientist struggles to adjust to her new life working in a Scottish kebab shop
Bodyworlds museum: Dr Gunther von Hagens has battled legal threats, Parkinson's disease, and the threat of bankruptcy

Dying dream of Doctor Death

Dr Gunther von Hagens has battled legal threats, Parkinson's disease, and the threat of bankruptcy