A private equity group today said it was battling on with its controversial £93m bid to take over pub company Yates.
Bid vehicle Thorium, set up by GI Partners, said it was extending its 140p per share offer for Yates for another week after persuading investors representing 26.6% of Yates shares to accept it.
Thorium, which needs to secure 90% of the shares to force other shareholders to sell up, said earlier this week that 23% had accepted the bid.
It said it would consider the options available to it after next Thursday’s deadline.
On Wednesday, founding family investors in Yates who represent about a fifth of its shares attacked the Thorium bid for undervaluing the pub group.
They challenged Thorium to extend and increase its offer and threatened to retain their stakes even if it secures a majority of the shares. Thorium did not improve its bid in announcing today’s extension.
The founding shareholders have formed a consortium and appointed investment bank Investec to advise them on the equity group’s offer.
They claim it fails to take account of the potential future benefits of Yates’ recent £18m refit of 98 of its pubs.
Thorium retorted that neither the consortium, nor its advisers, had explained how shareholders would realise value of more than 140p per share in the absence of a higher offer.
It added that Yates’ independent directors had considered the offer fair and reasonable and had unanimously recommended it to shareholders.
Bolton-based Yates, which employs 4,000 people and has 129 Yates and 23 Ha!Ha! outlets, has been attempting to reverse a sales slump amid tough trading conditions.
It has seen annual profits slide from £15.6m in 2000 to £10m in 2003, although its full-year results last month showed a slight recovery at £10.6m.
References: EGi News 23/07/04
