Outlook: GUS/Argos

LORD WOLFSON, chairman of Great Universal Stores, just cannot seem to get this Argos business out of his system. He reckons the former Argos directors made inaccurate statements during the heat of the bid battle, and he wants them to suffer a public humiliation to make up for it.

How the language flowed yesterday. The Takeover Panel should show the former Argos team the yellow card, he said. There were clear breaches of the rules and the ref should act. Failure to do so would turn bids into a car-boot sale, he fumed.

Let us look at the facts. In its early defence documents, Argos said sales in its five start-up stores in Holland were "ahead of expectations". Under the terms of the code, companies are supposed to inform the market of "any material change to any information". Having now got hold of the management accounts, GUS says sales in Holland were 40 per cent below forecasts by the end of the bid.

This is being disputed. Sales may have dipped below forecasts in some weeks, but taken cumulatively sales were ahead of expectations throughout the entire duration of the bid. Was this a change that should have been disclosed?

Having been turned down by the Panel once, Lord Wolfson has made a renewed approach, but his "fresh information" does not seem to have made the executive change its mind. Note, Lord Wolfson is not claiming that these allegedly misleading statements caused him to increase his offer for Argos. Nor is he saying that as a result he paid too much or that he has been sold a pup. But Lord Wolfson is not giving up. He is fighting on a point of principle which his advisers say is a "noble act".

If he loses, shareholders might think otherwise. He is already in danger of appearing vindictive. Using shareholders' money to fight a court case on a point of principle he looks unlikely to win, and which even he admits has inflicted no damage, would be a very strange act indeed. Lord Wolfson has had his tantrum. He should now shut up.

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