Slough Estates offers pounds 264m for Bilton as family rift opens

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The Independent Online
SLOUGH ESTATES fired the opening shot in a potential bid battle yesterday when it made a pounds 264m unsolicited approach for Bilton, a sleepy, family-run property group where former England cricket captain Lord Cowdrey is a non-executive director.

Bilton immediately rejected the approach but Slough Estates is hoping to exploit a rift between the Bilton family members who control the company. Bilton has been regarded as bid-proof because of a 29 per cent holding by Glenhazel, a family trust. But the family has become divided over the trust's direction.

The feud became public last year when one the Glenhazel trustees started legal action against three other trustees. The action pitches three family members against a group led by Ron Groom, Bilton's managing director. It seeks the removal of three of the trustees, including Mr Groom, due to an alleged conflict of interest.

Mr Groom took over the company in 1983 following the death of its founder, Percy Bilton. He courted controversy when he retired in 1992 with a pounds 1m pay-off, only to return as managing director three years later. In 1996 his pay was doubled to pounds 500,000. Mr Groom is chairman of the remuneration committee.

Slough Estates is believed to be courting Percy Bilton's children, Derek and Hazel, who, insiders say, may be willing to sell their shares.

Bilton is an industrial property company with a portfolio based predominantly in London and the South-east. Its main asset is an industrial estate in the South-east though it also controls the salmon fishing rights on the banks of the River Dee.

The group's shares have underperformed the market by 42 per cent in the past five years and Slough believes it can improve value to shareholders. It is offering 300p per share, a 41 per cent premium to Bilton's closing price on Thursday. The offer is 210p cash and 90p in new Slough shares. There is a 290p cash alternative. Bilton shares closed 81p higher at 293.5p.

Derek Wilson, chief executive of Slough Estates, said: "We haven't approached the board because we know they have been reluctant to talk in the past. But we believe that some of the family members will be interested in our offer."

Slough Estates is Britain's fifth largest property company. Its interests are mainly in the industrial sector in the South-east, making Bilton a good fit.