Slough's bid for Bilton turns ugly

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The Independent Online
THE ATTEMPT by Slough Estates, the property group, to take over its troubled rival Bilton, took a bitter twist yesterday as the two parties engaged in a fierce war of words.

The atmosphere was further soured by the appearance of an anonymous document that makes a series of unsubstantiated allegations about people related to recent events at Bilton.

Slough, which last month launched a pounds 264m hostile bid for Bilton, fired the first shot, accusing Bilton's management of adopting an "inappropriate financial strategy and a misguided approach" to develop its portfolio, largely made up of industrial properties.

In a letter to Bilton shareholder, Slough claimed that Bilton "has failed to invest adequately in the company's industrial property portfolio and has acted more like collectors of rent than active property managers". This resulted in Bilton's "failure to deliver any meaningful growth in net rental income," the letter added.

Slough, which owns about 6.8 per cent of Bilton, attacked the underperformance of the company's shares over the past five years. It claimed that shareholders' returns fell 16 per cent over the period, compared with a 45 per cent increase for the property sector as a whole.

Bilton hit back by pointing to 17 years of "uninterrupted dividend growth" and sharply criticised Slough's dividend policy. "Slough's shareholders are still waiting for their dividend to return to the level paid in 1991," it said in a statement.

The company launched a scathing attack on Slough's financial performance, saying it was compelled to make a rights issue in 1993 "in order to relieve its over-stretched gearing".

The anonymous document, sent to The Independent, made a number of potentially damaging and unverifiable allegations about people involved in the Bilton saga. There was no indication where it came from.

Outlook, page 21

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