Each group in the protracted struggle to control the ferry group holds a blocking stake to frustrate the other's offer, writes Claire Shoesmith.
The stalemate between two groups seeking to take over Irish Continental Group (ICG) continued last night, despite the efforts of the independent directors to bring the near five-month saga to a conclusion.
Sources close to the bidding parties said neither party had responded to the ultimatum issued earlier this week by independent directors of the shipping group.
Aella, the buyout group led by ICG chief executive Eamonn Rothwell, has matched a €22 per share bid tabled under a scheme of arrangement by Philip Lynch's Moonduster, which comprises One51 and the Doyle shipping group. Each group holds a blocking stake - Moonduster controls 20.38 per cent of ICG and Aella 17.19 per cent - to frustrate the other's €560.9 million offer for the company.
The independent directors declined to comment last night on whether either consortium had complied with the noon deadline they imposed for naming the highest price they are prepared to pay for the ferry operator.
Onlookers said they weren't surprised that no one had moved to break the impasse, with one Dublin source saying that, even if they had named the highest price they were prepared to pay, they could have reserved judgment on a second question of what they would do if the directors recommend a bid other than their own, giving them leave to up their bid if it wasn't recommended and leaving the situation in exactly the same stalemate as it was.
As far as the independent directors are concerned, they are now left with little choice but to refer the situation to the Takeover Panel on the basis of their comments of earlier in the week that the situation has dragged on for too long now and that no resolution looks likely.
What the Takeover Panel can actually do remains to be seen, but it does have a legal obligation to ensure that a target company is not disrupted in its business for an undue period of time.
Also unclear are the next moves for the bidding parties. There is widespread acknowledgment that it may take the emergence of a new offer to move this situation on. In fact, one Dublin source said that if another bid did not emerge, the situation would still be rumbling on into next year.
On this front, shareholders may have Liam Carroll to thank. News that one of the State's biggest property developers has been building a stake - believed to be more than 10 per cent - in ICG through the purchase of contracts for difference at a price of €24 (a full €2 more than the offers on the table) could be music to shareholders' ears.
Some commentators believe the developer, who is known for his deep pockets, now has the upper hand and sources say they wouldn't be surprised if he seeks to go into partnership with one of the existing bidders on the provision that, when the time is right, he gains control of ICG's 33-acre site in Dublin Port.
While the wait could be long - analysts say the site could only be developed in conjunction with a redevelopment of the whole port because of its location at the far end of the port site - this isn't expected to deter Carroll. His staying power is well known.
He is also no stranger to stakebuilding, having sat on a large position in Dunloe Ewart for more than two years before wresting control from Noel Smyth in a protracted process. He followed a similar path in building a stake in hotel group Jurys Doyle only to find he was too late to gain control of the properties as they were being sold to rival property developer Sean Dunne.
Even now he is the proud owner of a 29.5 per cent stake in food group Greencore, though there is no doubt that it is the company's 900-acre landbank, and in particular its sites in Mallow and Carlow, that he is after rather than the group's food business.
Whatever his intentions are - Carroll is known to be media shy and is not prone to publicising his plans - the property angle is not as simple as it sounds. Unlike in the case of the Irish Glass Bottle site in Dublin Port which was sold for €16.5 million an acre by South Wharf last year, the ICG land is held on a long-term lease from the Dublin Port Authority and can be used only for port-related activities.
If the port were to be redeveloped, the land would likely return to its original owner, leaving Carroll empty handed. So while the South Wharf valuation implies about €545 million for the ICG land, this is more theoretical than practical.
Still, there is one thing that is for sure; Carroll's stake-building puts him in a prime position to break the deadlock that has been rumbling on between Aella and Moonduster since Eamonn Rothwell increased his stake in the ferry group on June 20th and raised his original €18.5 a share offer to match the €22 a share approach made by rival Moonduster.
The question in the end, however, may well be who wants it most. While it is hard to imagine Rothwell walking away, particularly after waiting so long to make his move on the company he has run for the past 15 years, he stands to make significant financial gains if he sells his stake.
One51 meanwhile has recently stated its intention to float and needs to start generating cash to prove itself ahead of any such exercise. Failure in this area wouldn't send a good sign to future investors.
As a result of its partnership with the Doyle Group, its bid is likely to be subject to competition concerns as, between them, Doyle and ICG control about 60 per cent of cargo handling at the terminal in Dublin Port.
A long-running competition investigation could result in any deal being delayed even further, something that judging by their comments earlier this week, the independent directors are keen to avoid.
