Desmond raises stake in Barlo to 7.7%
Mr Desmond's investment vehicle IIU told the stock exchange that Bottin Investments, another Desmond company, spent almost €1 million on Barlo shares on Wednesday.
Mr Desmond's intervention brought Barlo's share price to 42 cent, which was two cent over the price offered by Barlo chief executive Tony Mullins when details of his management buyout bid were announced last week.
Barlo's independent directors recommended the offer to shareholders at the time, saying it was "fair and reasonable."
But analysts unhappy with the Mullins offer, which valued Barlo at €70 million, felt the company was worth more.
John Mattimoe of Merrion stockbrokers said Barlo's true value lay between 45 cent and 50 cent per share.
Mr Mattimoe added that the share price could double if the company took advantage of improved trading conditions and paid down its substantial debt over the next three years.
Mr Desmond's intentions regarding Barlo remain unclear, but he is unlikely to accept the Mullins offer.
His stake in the company is now worth €5.6 million, with his companies spending almost €2 million snapping up Barlo shares over the past week alone.
The Mullins offer needs the approval of 80% of shareholders in order to be successful.
The bid would fail if shareholders with 12.3% of the company were to join with Mr Desmond in voting against the proposal at the extraordinary general meeting scheduled for next month.
Dr Mullins has already agreed to either match or accept a rival bid for Barlo if such a bid valued the company at 44 cent or more.
This has led to speculation that he may beprepared to offer a higher price to gain control of the company he joined in 1990.
A formal offer document is expected to be issued to shareholders within the next two weeks.
The document will also include details of the proposed sale of Barlo subsidiary Athlone Extrusions.
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