Thistle investors rebuff BIL bid

Thistle Hotels yesterday piled pressure on its largest investor to increase a 115p-a-share hostile bid by revealing that more than one-third of its shareholders did not intend to accept BIL's takeover offer.

The company said more than 39 per cent of its shareholders had told it that they planned to reject the cash offer from the Singaporean investment group.

Thistle has rebuffed BIL's bid, worth £554m, as an attempt to buy it "on the cheap at a low point in the cycle". Hotel groups have been hit by the collapse in international travel since 11 September 2001, made worse by the economic downturn and America's invasion of Iraq.

David Newbigging, Thistle's chairman, said: "This strongly reinforces our view that BIL's wholly inadequate offer significantly undervalues the company." Crucially, Thistle's supporters include the Singapore government, which owns 20 per cent of the group. They also include Tweedy, Brown, of the US, and Insight Investment Management, of the UK. BIL needs a minimum of 75 per cent acceptances to de-list Thistle, its spokesman added.

But a spokesman for BIL, which already has a 45.8 per cent stake, dismissed these expressions of support as not legally binding. He added: "BIL observes that, regardless of this, all of these shareholders can still accept BIL's offer in due course."

A key plank of Thistle's defence is its pledge to dip into its £367m cash pile and return 50p-a-share to investors. Thistle shares were flat at 118.5p.