The TV and catering group's stock fell another 11p on Friday after a US investor put 3 million shares on the block.
A raised bid appeared even more necessary as Forte's shares edged up 0.5p to 338.5p, widening the gap between the bid and the current market price to 13p.
Last week Forte pledged to split up its Little Chef and Happy Eater restaurants from its hotels interests, as well as to spin off its Savoy hotel stake.
However, Forte's claim to be worth more was undermined by the revelation in its defence document that its chairman, Sir Rocco Forte, cashed in 382,000 share options at 230p just five months ago for a profit of pounds 379,000. Asked about the transaction, Sir Rocco laughed and said: "I needed the money to cover my overdraft."
Meanwhile, Granada's shares have dropped more than 9 per cent since it pounced three weeks ago - from 697p to 634p at Friday's close. After the 7.9p dividend is stripped out, the shares are now worth just 626p, a penny more than the 625p at which sub-underwriters including Lazards, Hoare Govett and BZW agreed to support the bid.
Further slippage could easily see them taking a bath on the deal and would make a second round of underwriting more difficult without dilution of Granada's earnings.
Granada dismissed the latest fall, saying that price fluctuations are inevitable during a bid and noting that the FT-SE 100 index closed down last week. However, since the bid battle began, the index has risen almost 26 points.
The descent has turned attention from the basic offer of four Granada shares and pounds 23.25 for every 15 Forte shares - now worth pounds 321.93 - to the all-cash offer of pounds 321.67.
It also raised doubts about the backing the Granada chairman, Gerry Robinson, will receive at its extraordinary general meeting on Tuesday to vote on the takeover, although the company remains confident it will receive "overwhelming support".Reuse content