Archive for March 2005

Brian Spence

As illustrated by the failure of Philip Green’s bid for Marks & Spencer and Permira’s bid for WH Smith, the already complex process of negotiation that typify merger and acquisition activity has recently become that bit more complex as pension scheme trustees start to flex their new-found muscles to assume an integral role in determining the success or failure of a bid for the ownership of a company.

In the case of Mr Green’s bid for M&S, for example, a key determinant of its failure was the fact that trustees arrived at the conclusion that, with the company pension scheme having run up a substantial deficit, should Green’s bid be successful, M&S’s credit rating would fall. It would therefore be more highly geared and be considered by analysts to be a riskier business. Read more »

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