Cable & Wireless Plc likes to make ’em sweat. The company waited until yesterday – the last day permissible under Takeover Panel rules – to increase and adjust the terms of its bid for Telephone Rentals Plc, pitching the new one at 340 pence a share against the previous 305 pence, and splitting the difference between the 350 pence the market hoped for and the 330 pence it feared. And Cables has answered Telephone Rentals’ criticism that with no paper option, its shareholders would not benefit from the increase in value of Cable & Wireless as a result of taking it in by offering a convertible loan stock option that may be accepted for part or all of the shares held. Holders who want the paper will get UKP1 nominal of 7% loan stock for every UKP1 cash they would otherwise be due, and conversion will be at one new share for every 412p nominal of the loan stock against 365p yesterday. The original loan note alternative, which may appeal to some holders for tax reasons, is also open at the new price. And this really is the final offer and will not be increased unless somebody comes in with a counter-bid for Telephone Rentals – which sounds like an invitation to that company to go out and find itself a white knight. The new offer, valuing Rentals at UKP319.8m for an exit price earnings ratio of 24.2 times, closes at 1pm, Wednesday December 7.
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