SixCon demerger should proceed

7 March 2003 By Hugo Dixon Follow @hugodixon

Osmond’s mainlypaper offer is not compelling. He is also trying to take too big a slice of the action for himself. Better to back the demerger and entertain bids for the component bits afterwards.

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The battle between Six Continents and Hugh Osmond, the entrepreneur making a hostile bid for the UK hotels group, heated up as the two sides tried to win round shareholders in advance of a key vote on March 12. SixCon is seeking authority from to split the group into two.

Osmond was forced to admit that an adviser had told a newspaper that certain of SixCon's largest shareholders wanted an adjournment of the vote but that it could not confirm that this was true to the standards required by the Takeover Panel. Osmond wants shareholders to vote against the demerger.

Meanwhile, SixCon admitted it had been contacted by Marrriott, Texas Pacific Group and CVC among others. But it said it was "not expecting any of them to table proposals prior to demerger".

The group argued shareholders would still have a choice to accept Osmond's offer if the demerger vote went through. It said it could withdraw the demerger any time up to 14 April when the court was scheduled to sanction the scheme of arrangement.

SixCon also said that both the current board and the boards of the two demerged companies would give serious consideration to any proposal that might be attractive to shareholders and has a reasonable prospect of delivery.

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