BBC Homepage World Service Education
BBC Homepagelow graphics version | feedback | help
BBC News Online
 You are in: Business
Front Page 
World 
UK 
UK Politics 
Business 
Market Data 
Economy 
Companies 
E-Commerce 
Your Money 
Business Basics 
Sci/Tech 
Health 
Education 
Entertainment 
Talking Point 
In Depth 
AudioVideo 

Friday, 18 August, 2000, 13:52 GMT 14:52 UK
Hyder faces fresh battle

Water company Severn Trent plans to start legal action against Hyder, in a move which could disrupt the planned takeover by Western Power Distribution.

Severn Trent claims that WPD, the winner of the four-month takeover battle, plans to contract out some of Hyder's water services to United Utilities.

This contract should have been put out to competitive tender under UK and European Union regulations, Severn Trent said.

WPD finally won the bitter four-month battle for Hyder when rival bidder Nomura threw in the towel earlier this week.

On Friday, the company said it doubted the Severn Trent action would influence the takeover.

"It would seem they are behind the game. Our bid has been cleared by all the relevant authorities," a WPD spokesman said.

The Japanese bank said on Thursday that it would not contest the decision from the Takeover Panel giving victory to its rival's 565m bid for the Welsh group.

The Takeover Panel is now set to announce its reasons for rejecting an appeal by Japanese bank Nomura over the confused sealed bidding process for Welsh utility Hyder.

The National Assembly for Wales - which has opposed WPD's bid all along over job relocation fears - said it was now prepared for "constructive talks".

Dramatic end

Guy Hands, the head of Nomura's Principle Finance group, said: "We have decided not to prolong the period of uncertainty for Hyder's stakeholders, particularly the employees who have been through a great deal over the last few months.

"We are obviously disappointed that we are now unlikely to be able to introduce the plans we have made to develop the company as a whole."

Mr Hands also took a swipe at rival WPD, saying: "Unfortunately, Hyder was always going to be more valuable to someone willing to carry out a break-up strategy."

National Assembly secretary Sue Essex said that - in spite of concerns at WPD's business plans - members were prepared to sit down and talk with the company.
First Secretary Rhodri Morgan
Job Concerns: Welsh First Secretary Rhodri Morgan

"This is the time for some really constructive talking," she told BBC Wales.

"We want to impress upon WPD that Hyder has been successful and that the people of Wales are looking to them to keep many of the commitments of Hyder."

The assembly will also seek a key role in the licensing of Welsh Water/Dwr Cymru, in relation to pricing and regulations.

"We have had assurances from Ofwat that we will have a very strong say in what actually happens," Ms Essex added.

Bidding war

The battle for control of the Welsh utility company Hyder had been expected to end dramatically with the submission of sealed bids on 11 August.

The highest offer should have won the day to take control of Wales's biggest company and its 9,000 staff.

But rival bidder Nomura appealed against the decision, claiming that WPD had submitted its higher bid of 365p per share too late.

The battle between Nomura and US-controlled group Western Power Distribution saw shareholders' stakes almost double in value over the last four-and-a-half months.

Before Nomura's first bid at the end of March, Hyder shares were languishing at 189.25p.

Nomura's bid of 360p per share values Hyder at 2.37bn, including debt of 1.8bn.

The company's shares slipped from 369p to 363p this week as the possibility of a bidding war receded.

Hyder's main activities include Dwr Cymru, the regulated supplier of water and waste water services to most of Wales.

Search BBC News Online

Advanced search options
Launch console
BBC RADIO NEWS
BBC ONE TV NEWS
WORLD NEWS SUMMARY
PROGRAMMES GUIDE
See also:

15 Aug 00 | Business
D-Day for Hyder
13 Aug 00 | Wales
Hyder takeover bidding row
15 Aug 00 | Business
Takeover Panel under fire
07 Jul 00 | Wales
Snub leads to Hyder job fears
13 Jul 00 | Business
Hyder holds back dividend
Internet links:


The BBC is not responsible for the content of external internet sites

Links to more Business stories are at the foot of the page.


E-mail this story to a friend

Links to more Business stories