Outlook: Greenalls fever strikes - yet again
Tuesday 16 February 1999
This time the potential suitor is supposed to be Whitbread with a pounds 1.2bn bid at 400p per share. And the market has got itself in such a fervour of bid expectancy at the moment that Greenalls shares, not known for their sprightly behaviour, frothed up almost 11 per cent higher yesterday to 376.5p.
As ever, Greenalls is certainly a potential target. Its shares have underperformed the market by 50 per cent over the last five years. And Greenalls has done much of its own dirty work by getting out of brewing and, more recently, flogging its tenanted pub estate to Nomura for pounds 370m. What is left is a much more attractive core of managed pubs, a fledgling health club business and, most importantly the De Vere hotels chain.
It is De Vere that is the key. Ladbroke's pounds 1.2bn takeover of Stakis last week has underlined the value in the hotel sector, and the pub market is in the process of a major consolidation. De Vere would certainly fit Whitbread's strategy. It wants to beef up its leisure operations and De Vere would combine nicely with Whitbread's Marriott chain while Greenalls' fledgling Greens health club operation would dovetail with Whitbread's David Lloyd centres.
But then Whitbread has also run the slide rule over Vaux and its highly- valued Swallow hotels chain. If Vaux sells its brewing and tenanted pubs operation as planned it too would look more attractive to bidders.
Of course, all this may just be the wishlist of frustrated institutional shareholders who are waiting for their dismal investments to pay off. In Greenalls' case they are Schroders and the new value fund set up by Hermes which played such a prominent part in the removal of David Montgomery at Mirror Group. Hermes says it is not in the business of provoking bids and prefers to work with the management. But with the track record of the Greenalls board, that patience may not last long.
- 1 Benedict Cumberbatch says Hollywood is better for black British actors
- 2 Man who held up 'hire me' sign at Waterloo station returns a year later with 'I'm hiring' sign
Rowan Atkinson to sell £10 million McLaren 'supercar' he crashed into a tree and a lamppost
UK weather: Snow to fall in the coming week with sub-zero temperatures to last until early February
Saudi preacher who 'raped and tortured' his five -year-old daughter to death is released after paying 'blood money'
US blames Russia after rocket attacks in Ukraine kill at least 30
Warriors in ancient Iraq suffered Post-Traumatic Stress Disorder more than 3,000 years ago, say researchers
Nigel Farage: NHS might have to be replaced by private health insurance
'We would evict Queen from Buckingham Palace and allocate her council house,' say Greens
French court convicts three over homophobic tweets, in case hailed as a 'significant victory' by LGBT rights campaigners
George Galloway condemns 'racist, Islamophobic, hypocritical rag' Charlie Hebdo at freedom of speech rally
British Muslim school children suffering a backlash of abuse following Paris attacks
Islamic history is full of free thinkers - but recent attempts to suppress critical thought are verging on the absurd
iJobs Money & Business
£30000 - £32000 per annum + benefits : Ashdown Group: A highly successful, int...
£18000 - £20000 per annum: Recruitment Genius: This rapidly expanding business...
Negotiable: Recruitment Genius: A Tax Assistant is required to join a leading ...
£16000 - £25000 per annum: Recruitment Genius: This is an exciting opportunity...