Green ponders M&S offer

PHILIP GREEN is still undecided about whether to pursue an offer for retailer Marks & Spencer, a source close to the retail tycoon says, downplaying newspaper reports that he is set to raise his offer.

“He has not decided, he is having a think but there has been no decision,” the source told Reuters yesterday.

The Observer said Mr Green was ready to raise his bid approach for the country’s top clothing retailer by as much as £1 billion after M&S rejected his multi-billion-pound proposal.

A renewed attempt by Green to get his hands on Marks & Spencer could result in a bid worth up to £10 billion, or 425p a share, the newspaper said.

The country’s biggest high street name on Thursday rejected his cash and share approach, which analysts and investors said was worth as little as 330p a share, on the grounds it significantly undervalued the group.

The potential bid was pitched well short of the 400p, or £9bn that investors had hoped for.

Mr Green was considering whether to make an all-cash bid, throwing out earlier plans to offer a small portion of “stub” equity.

Another option being considered was a mix of cash and shares that would inflate the equity portion to more than the 25% suggested last week.

But a source familiar with the situation said on Friday that Mr Green was considering his options after M&S’s rejection, adding he had no immediate plans to lobby institutional shareholders for support. And the source yesterday said the situation remained unchanged.

Mr Green’s proposal on Thursday was for 290 to 310p a share in cash for M&S plus a 25% stake in a new holding company. The offer’s value is dependent on how analysts choose to price the stake in that new firm, Revival Acquisitions.

Marks & Spencer’s new chief executive, Stuart Rose, is expecting a higher bid from Mr Green.

“He is a determined man,. “I would expect he will come back again. I am expecting a press blitz on me and I am expecting him to up the ante.”

Mr Rose, a renowned turnaround expert, last week replaced chief executive Roger Holmes, who was blamed for stalling sales at M&S.