Melrose told to put or shut up

INDUSTRIAL takeover group Melrose reacted angrily after its takeover target Charter International referred it to the Takeover Panel yesterday.

The Panel set a “put up or shut up” deadline of 6 September for Melrose to either make a formal offer or walk away, giving it less than four weeks to conclude its deal.

Engineering group Charter has rejected two offers from Melrose in the past six weeks, the most recent valuing it at £1.4bn, as too low, while Melrose has said it could raise its offer further if Charter allowed it to conduct due diligence.

Several of its large investors including Schroders, which holds eight per cent, and Aviva Investors, which holds 5.23 per cent, have publicly called for Charter to open its books but the company has refused, saying the majority of shareholders oppose the move.

Both sides accepted the ruling but Melrose expressed its frustration with Charter’s move.

“We are disappointed that Charter has taken this step and it appears that they are not listening to the clear voices of their shareholders,” it said in a statement.

Sources close to Charter rebuffed the criticism, however, saying the board was listening to all its shareholders.

But Melrose sources said the current market volatility and share price slumps meant its highest offer, of 840p per share, may come down. Charter’s shares closed at 679.5p yesterday.