HBOS-led 'Mother Bidco' scoops McCarthy & Stone

After tabling its £1.1bn take-over offer for McCarthy & Stone, the specialist retirement homebuilder, the consortium known as 'Mother Bidco' has finally won the day.

Its offer of 1,075p a share was made on 1 August. At that time, an earlier rival bid of 1,030p had not only been tabled, but had the backing of McCarthy's management team and the rival bidders. It came from a consortium known as 'Mars Bidco', which had negotiated a break clause, such that it would benefit to the tune of a £10m break fee should McCarthy's loyalties switch to a new camp.

McCarthy has done just that and will be paying up.

After weeks of speculation that 'Mars Bidco' would come back with a higher bid, it has pulled out, adding that it "wished the management, employees and eventual owners success for the future".

A spokesman for McCarthy said: "The 1,075p-a-share from 'Mother Bidco' is a done deal, really."

The winning HBOS-led consortium includes billionaire brothers Simon and David Reuben and sports-shop tycoon Sir Tom Hunter.

Three years ago, John McCarthy, who founded the housebuilding group, offered 500p to take it back to a private status. The board turned him down and he resigned, selling off his 13% shareholding. The value of the group's shares immediately prior to the latest bidding war was 790p.

[Contract Journal, 6 September 2006, p 2]