LWT Reaction To Increased Granada Bid

Following yesterday’s increased bid for LWT by Granada, the board of LWT have made it clear they still consider the bid inadequate. Sir Christopher Bland, Chairman of LWT, maintained that LWT shareholders would suffer a decrease in dividend income if they accepted. Media analysts agree that the offer is not over-generous and still hostile. Reports in the press indicate that senior sources at LWT feel the outcome of the offer will be close but are hopeful that they will retain the support of their institutional share-holders.

The Granada offer of £776m represents 26.4 times LWT’s estimated 1993 pre-tax earnings of £43.8m. Fund manager MAM will play a major part in whether the bid is accepted; they hold a substantial stake in LWT as well as 16.5% of Granada.