and JAMES CUSICK
The mighty Forte dynasty yesterday conceded defeat in one of the most fiercely fought takeover battles ever, succumbing to a pounds 3.8bn hostile bid from Granada, the television and leisure company.
The news that Forte's shareholders had overwhelmingly accepted Granada's terms was met with bitter disappointment in the Forte camp, particularly by Sir Rocco Forte, his father, Lord Forte, and his sister, Olga Polizzi, the principal family shareholders.
Sir Rocco, 51, head of the hotel and catering empire built up by his father and grandfather, forced an almost continuous 10-minute smile on to his face to hide his disappointment.
In a shaky voice, he said: "We delivered a lot of value for our shareholders. We did a very good job in defending this company and I am only sorry for the people in the business who have helped take it forward."
The Forte family members will receive pounds 300m if they tender their shares to Granada, which observers last night predicted. "There is no point now in hanging on," a senior City analyst said. "They have lost."
The Forte family is expected to relaunch a family-run hotels company, possibly by purchasing some of the hotels being sold by Granada. At the end of yesterday's press conference Sir Rocco said: "I'll be back."
Granada's chief executive, Gerry Robinson, said he was delighted with the outcome of the two-month battle. "I won and lost this bid so many times in my heart," he said. However, Sir Rocco, describing the fight between Granada's cost-cutting management and his family-led team, said: "This was a battle between two opposing philosophies. We have lost the bid, but I do not believe we have lost the argument."
Granada has won control of Forte's chain of luxury hotels, including a stake in the Savoy Group of hotels and restaurants, as well as the Happy Eater and Little Chef roadside catering businesses and the Travelodge budget-hotel chain.
Granada intends to sell assets worth pounds 2bn, to pay for the bid and focus the new business on roadside restaurants and on budget and mid-market hotels. A stake in the Savoy Group will be sold, as will the Meridien and Exclusive hotel chains.
Granada intends to keep the 430 Happy Eater and Little Chef restaurants, of which almost 100 will be transformed into fast-food outlets, featuring brand names such as Burger King. Mr Robinson promised that job losses would not top 1,000, and said he intended to meet Sir Rocco and other senior managers today.
Mr Robinson paid tribute to Forte's defence. "It was pretty sparkling, and if anyone thought Forte was going to say 'here you are,' they were wrong."
But Granada's bid swayed institutional shareholders looking to lock in profits and willing to bet Mr Robinson could provide profits. It relied particularly on support from Mercury Asset Management, which held a vital 14 per cent of Forte.
Rocco lost everything, page 3
MAM clinches deal, page16
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