Permira told to 'put up or shut up' over its bid for WH Smith

Permira was yesterday put on notice to come back with a revised offer for WH Smith by 9 August or walk away from bidding for six months.

Permira was yesterday put on notice to come back with a revised offer for WH Smith by 9 August or walk away from bidding for six months.

WH Smith broke off takeover talks with Permira over a 371p offer last month, after Permira became concerned about a deficit in the company's pension fund that needed a cash injection. The Takeover Panel yesterday issued the "put up or shut up" order to the private equity house, demanding that it come forward with a bid by 9 August or withdraw.

A source said yesterday that Permira was intent on returning to the board within the next couple of weeks with a revised offer. Permira is understood to have been talking to a number of banks, as well as to the WH Smith's pension trustees, on how to find funding for a takeover deal that secures the pension scheme and also provides value to shareholders.

The pension fund is thought to require a £150m lifeline, which Permira is trying to factor in its revised bid. A bill of £150m is equivalent to taking 60p off the value of every WH Smith share, bringing Permira's initial bid down to 311p. A revised offer for WH Smith is likely to start from this base.

"What shareholders have to bear in mind is that the pension fund needs cash, regardless of whether or not there is a takeover," an insider said yesterday. WH Smith is planning to sell its Hodder Headline publishing business, but most of the proceeds would go towards safeguarding the pension fund.

Keith Hammill and Simon Burke, former WH Smith executives, have so far spearheaded the bid team. But John Lovering, the retail entrepreneur who has made bid attempts for Debenhams and Somerfield, is understood to have joined the team as deputy chairman.

WH Smith is understood to be relieved by the Takeover Panel's intervention. Shares yesterday closed down 0.5 per cent at 317.5p, giving the company a market capitalisation of £795.4m.

Start your day with The Independent, sign up for daily news emails
  • Get to the point
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: Retirement Coordinator - Financial Services

Negotiable: Recruitment Genius: To provide a prompt, friendly and efficient se...

Recruitment Genius: Annuities / Pensions Administrator

Negotiable: Recruitment Genius: You will be the first point of contact for all...

Ashdown Group: HR, Payroll & Benefits Officer - Altrincham - up to £24,000.

£18000 - £24000 per annum + benefits: Ashdown Group: HR, Payroll & Benefits Of...

Ashdown Group: Learning and Development Programme Manager

£35000 - £38000 per annum + benefits : Ashdown Group: A highly successful, int...

Day In a Page

The saffron censorship that governs India: Why national pride and religious sentiment trump freedom of expression

The saffron censorship that governs India

Zareer Masani reveals why national pride and religious sentiment trump freedom of expression
Prince Charles' 'black spider' letters to be published 'within weeks'

Prince Charles' 'black spider' letters to be published 'within weeks'

Supreme Court rules Dominic Grieve's ministerial veto was invalid
Distressed Zayn Malik fans are cutting themselves - how did fandom get so dark?

How did fandom get so dark?

Grief over Zayn Malik's exit from One Direction seemed amusing until stories of mass 'cutting' emerged. Experts tell Gillian Orr the distress is real, and the girls need support
The galaxy collisions that shed light on unseen parallel Universe

The cosmic collisions that have shed light on unseen parallel Universe

Dark matter study gives scientists insight into mystery of space
The Swedes are adding a gender-neutral pronoun to their dictionary

Swedes introduce gender-neutral pronoun

Why, asks Simon Usborne, must English still struggle awkwardly with the likes of 's/he' and 'they'?
Disney's mega money-making formula: 'Human' remakes of cartoon classics are part of a lucrative, long-term creative plan

Disney's mega money-making formula

'Human' remakes of cartoon classics are part of a lucrative, long-term creative plan
Lobster has gone mainstream with supermarket bargains for £10 or less - but is it any good?

Lobster has gone mainstream

Anthea Gerrie, raised on meaty specimens from the waters around Maine, reveals how to cook up an affordable feast
Easter 2015: 14 best decorations

14 best Easter decorations

Get into the Easter spirit with our pick of accessories, ornaments and tableware
Paul Scholes column: Gareth Bale would be a perfect fit at Manchester United and could turn them into serious title contenders next season

Paul Scholes column

Gareth Bale would be a perfect fit at Manchester United and could turn them into serious title contenders next season
Inside the Kansas greenhouses where Monsanto is 'playing God' with the future of the planet

The future of GM

The greenhouses where Monsanto 'plays God' with the future of the planet
Britain's mild winters could be numbered: why global warming is leaving UK chillier

Britain's mild winters could be numbered

Gulf Stream is slowing down faster than ever, scientists say
Government gives £250,000 to Independent appeal

Government gives £250,000 to Independent appeal

Donation brings total raised by Homeless Veterans campaign to at least £1.25m
Oh dear, the most borrowed book at Bank of England library doesn't inspire confidence

The most borrowed book at Bank of England library? Oh dear

The book's fifth edition is used for Edexcel exams
Cowslips vs honeysuckle: The hunt for the UK’s favourite wildflower

Cowslips vs honeysuckle

It's the hunt for UK’s favourite wildflower
Child abuse scandal: Did a botched blackmail attempt by South African intelligence help Cyril Smith escape justice?

Did a botched blackmail attempt help Cyril Smith escape justice?

A fresh twist reveals the Liberal MP was targeted by the notorious South African intelligence agency Boss