Pyrrho seeks answers over bid for Business Exchange

There was a new twist in the long-running takeover saga around the office space provider MWB Business Exchange yesterday after a top shareholder called on the bidder to explain why it had failed to come forward with a formal offer.

Pyrrho Investments, the second-largest shareholder in MWB Business Exchange, had signed an undertaking to back an offer by the company's biggest investor, MWB Group, which owns around 72 per cent of the business. But the agreement expired on 12 August, prompting the demand for an explanation.

The MWB offer values Business Exchange at around 80.1p per share, or £52m, above the £49.4m value implied by yesterday's closing share price of 76p.

Pyrrho said MWB Group needed to explain formally "to all shareholders of MWB and Business Exchange the specific reason for the delay in pursuing the possible offer, as well as the expected timetable to complete the possible offer".

In the absence of a public explanation, however, Pyrrho said Business Exchange's independent directors should go to the Takeover Panel and ask for a deadline compelling MWB to either make a formal bid, or walk away for at least six months.

Pyrrho added that if MWB "is unable or unwilling" to go ahead with the bid, then Business Exchange should seek out other suitors. "Business Exchange's shareholders have been more than patient in allowing MWB to formulate a possible offer," Pyrrho's investment director Paul Cummins said.

MWB declined to comment on Pyrrho's statement but, despite the delay, the company is understood to be pressing ahead with its offer for Business Exchange. Earlier, MWB snubbed interest in the company from the FTSE 100-listed office provider Regus.