The expected bid for UK retailer Marks & Spencer by tycoon Philip Green values M&S at £9 billion ($16.5bn; €13.5bn) -- but is very much on his own terms.
Green hopes to add to his UK retail empire by offering 290p–310p cash per M&S share plus a 25% share in the new company. Iain McDonald of Numis Securities thinks this is a "sensible first shot", but expects M&S will demand more.
M&S will have to declare any skeletons in its accounting cupboard before Green hands over any money, however. He is keen to check up on pension plan funding, recent trading data, store spending patterns and contractual obligations.
The takeover bid will now have to proceed with new lawyers after M&S successfully barred Green's current law firm, Freshfields Bruckhaus Deringer, on grounds of alleged conflict of interest.
Surprisingly M&S shares did not fare well, falling by 3.96%.
STOP PRESS 07.00GMT Fri-04-Jun-04
Green's Offer 'Underwhelming', Jibes New M&S Boss
Marks & Spencer has predictably raised two fingers to Green's bid -- a wholly foreseeable response given the retailer's appointment last weekend of a new chairman and ceo.
The latter, Stuart Rose, dismissed his old adversary's offer as "underwhelming". This too will raise no eyebrows: a seasoned campaigner like Green is unlikely to enter the fray with his best offer.
Green himself was in vaudeville mode. In a none-too-oblique reference to Rose, the entrepreneur sneered: "Nobody's paying me to go in and do the job: I'm paying to do the job. I'm prepared to back myself that I can run the business better than the previous management."
It is thought he will forcefully reiterate that point to analysts and key M&S investors -- although the majority of these are expected to sit tight until the zip on Green's bulging wallet is inched back a notch or three.
M&S will retaliate by emphasizing the near-certainty that the bid will be referred to the UK Competition Commission in the light of Green's existing high street empire which includes BHS, Dorothy Perkins and Top Shop.
Were he to add M&S to his trophy room, the multicolour billionaire would in many regions of the UK control up to 40% of the woman's wear market.
Data sourced from: Financial Times; additional content by WARC staff