Rivals raise stakes in battle over Rensburg

Investec, the South African wealth management group, will today sweeten the terms of its deal with Rensburg, the boutique asset manager planning to merge with Investec's Carr Sheppards Crosthwaite.

Investec, the South African wealth management group, will today sweeten the terms of its deal with Rensburg, the boutique asset manager planning to merge with Investec's Carr Sheppards Crosthwaite.

The aim of the revised deal is to beat off a hostile challenge from Rathbone Brothers, a rival private client fund manager which has made a takeover offer for Rensburg. The new terms will see Investec taking a much smaller stake in Rensburg once the deal is complete, rather than the 64 per cent that was originally planned.

Rathbone revealed yesterday that it had upped its offer to the equivalent of 656p per Rensburg share, including a 50p cash element. That was an improvement on the 610p bid originally made but immediately rejected last week.

The higher offer came after Rensburg opened up its books to Rathbones - following pressure from shareholders - but Rensburg said yesterday that it remained committed to the Investec deal.

Rathbone's 656p bid represents a 30 per cent premium to the company's 500p closing price on 10 December, when its shares were suspended following news of the deal with Investec.

Rathbone has not ruled out a hostile bid, saying yesterday that it believed that a merger with Rensburg would be "of real benefit to the shareholders, clients and to staff of both groups".