A bid for Crest Nicholson from HBOS and Scottish tycoon Sir Tom Hunter is likely to be tabled by this Friday’s deadline according to market analysts.
The Castle Bidco consortium is expected to table a revised takeover bid after a £660m offer valued at 585p a share was spurned in November.
Crest is believed to be demanding 635p per share – 40p more that the previous offer – although some analysts quote 650p as representing fair value.
Although there have been conflicting reports as to whether an offer will be tabled, it is widely thought that the consortium, which has amassed a 27% stake in the housebuilder, will not walk away.
The 27% stake is the combination of a 4% stake already owned by HBOS’s fund management arm with a 23.3% stake bought from Heron International, the private property group run by Gerald Ronson.
Mark Hake, a building analyst with Merrill Lynch, said: “It is unlikely that they [Castle Bidco] will walk away having bought a stake from Heron because you don’t pay that price and then walk away.
“This does not mean the bid will succeed, it could still end up with no deal going forward in the short term.”
There is also speculation that the consortium has pushed the deal in to the public eye so Crest Nicholson shareholders will force management to accept a compromise share price.
Hake agrees this could be the case, although points out that Ronson used this tactic when he made a takeover attempt for the housebuilder through the Heron Corporation in the first half of 2005.
That bid failed because shareholders thought the company was worth more.
The Takeover Panel has imposed a “put up or shut up” order on the consortium, setting a deadline of 5pm this Friday to announce a firm offer or walk away.
Shares in Crest Nicholson were down 1p at 611.5p yesterday, giving the company a market capitalisation of £689.937m.
References: EGi News 09/01/07
