Allied raises stakes to stay in race for Montana

By DANIEL RIORDAN

Allied Domecq has hinted it plans to match Lion Nathan in their takeover battle for Montana Group - without actually committing to do so.

Allied yesterday issued an amended restricted transfer notice after the market closed, matching Lion's bid in price and timetable.

The notice, which takes effect on Monday, raises the British brewer's bid from $4.55 to a range of $4.65 to $5.05 a share, and extends the period for settlement of any sale of shares from July 1 to August 16.

Allied, because it owns less than 20 per cent of Montana, can offer any price it wants without filing a notice. But the new transfer notice will allow it to carry on buying shares on Monday at that range without pausing for two days should it lift its stake from the roughly 10 per cent it holds now past the 20 per cent threshold.

Even Allied people admit that is an optimistic scenario.

Lion, which owns about 52 per cent of Montana, wants at least a further 5 per cent and said on Tuesday that it would offer between $4.65 and $5.05 a share when the market opened today. Because it owns more than 20 per cent, it had to wait two days from issuing its notice before making its move.

Allied's legal adviser, John Strowger, of Chapman Tripp, said issuing the amended notice gave Allied extra flexibility but did not necessarily mean that it would be offering that price on Monday.

He said the company could still enter the market today at any price, but he did not know its immediate intentions.

"This is just to try and send a little signal to people that we're trying to be competitive."

Allied spokeswoman Jane Mussared would not be drawn on what price Allied would be prepared to pay in the market.

"We'll remain on-market. We're buying as things become available but not at any price. We're making sure all our bases are covered and we will offer a full and fair price."

Would that full and fair price be somewhere between $4.65 and $5.05?

"It's a range."

Meanwhile, Montana deputy chairman Barry Neville-White and fellow director Hylton LeGrice confirmed they had sold shares to Allied along with chairman Peter Masfen.