Plantsbrook shares surge as SCI lifts holding to 8.5%
Having announced a small increase in its stake last week from 2.95 to 3.2 per cent, SCI said it had acquired a further single holding that had taken it to 8.5 per cent.
A spokesman for SCI said the American company hoped to buy more shares, and described the stake as a 'strategic investment'. He refused to say how large a shareholding SCI would try to pick up.
During its successful bid for Great Southern, SCI made clear that it would be prepared to sit on a substantial minority stake if it failed to persuade the controlling Field family to sell.
It finally dislodged the Fields after increasing its offer from an original 600p a share, worth pounds 87m, to 775p, or pounds 113m.
The stake in Plantsbrook is seen as a pre-emptive move to prevent rival North American groups from entering the UK market. Loewen, the Canadian burial company, took a look at Great Southern during SCI's offer but in the end did not table a counter-bid.
SCI, the largest burial company in the US, with 873 funeral homes, has grown aggressively, acquiring more than 700 companies over 30 years.
Between 1989 and 1993 its net profits doubled to dollars 103m.
Compensation terms were also announced yesterday for Great Southern shareholders who sold to SCI at 680p, thinking they were accepting an offer that could not be raised.
They will be paid the 95p difference between the 'final' offer and the higher bid with which it was replaced after the intervention of Loewen.
The takeover panel agreed that shareholders had been accidentally misled by SCI, whose advisers, Schroders and Linklaters & Paines, left out of official documentation a crucial clause giving SCI the right to raise its bid in the event of a competitive situation arising.
Yesterday Plantsbrook shares were up 12p at 175p.
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