Panel hears Nomura appeal against Hyder decision

The Takeover Panel remained locked in deliberations last night after hearing an appeal called to decide the fate of Hyder, the Welsh utility.

The Takeover Panel remained locked in deliberations last night after hearing an appeal called to decide the fate of Hyder, the Welsh utility.

The two bidders, Western Power Distribution, a US utility, and Nomura, the Japanese bank, presented evidence to a gathering of at least five members of the panel yesterday morning. The rival camps left the Takeover Panel, which is housed in the Stock Exchange building on Old Broad Street in the City, at about 12:30pm.

Arguing the case for Nomura was investment bank UBS Warburg and Freshfields, the law firm. WPD was represented by bankers Schroder Salomon Smith Barney and lawyers Allen & Overy. Guy Hands, the leader of Nomura's private equity arm, which is bidding for Hyder, was absent as he was out of the country.

At issue were the events surrounding the submission of sealed bids, used for the first time ever, on Friday. The subsequent dispute centres on the status of a 4.30pm deadline on that day, by which time the winning bidder had to make an announcement to the stock exchange.

WPD was apparently the victor but failed to make the 4.30pm deadline. It was, nevertheless, declared the winner by the panel's day-to-day executive very late on Friday as Nomura had not submitted any sealed bid. Nomura argued yesterday that missing the 4.30pm deadline made the WPD bid invalid, leaving their earlier offer the only valid bid.

The appeal proceedings seen yesterday, before the full panel, are much less formal than a court of law, and witnesses are not called. In recent years there have been three or four appeals a year.

Written submissions were made prior to the hearing, from each side in this case. The panel executive, in its written evidence, will have set out the uncontested facts and the reasons for its original decision in favour of WPD. During yesterday's hearing, the main points of the arguments will probably have been presented by the investment banker advisers. Lawyers are discouraged from speaking.

The side with the grievance - Nomura here - usually goes first and is allowed to speak without interruption from the rival camp. Afterwards, WPD will have had the opportunity to pose questions. After oral evidence from WPD, and questions to it, the panel went into recess.

Under the rules, if an aggrieved party is still not satisfied an appeal can be submitted to the Appeals Committee of the Takeover Panel. The Appeals Committee is chaired by a former law lord, who sits with two members of the full panel who did not hear the original case.

Alternatively, it can seek a judicial review. However, the courts have made it clear, in past cases, that they do not consider themselves having jurisdiction over a self-regulating body such as the Takeover Panel.