There will be plenty of red faces at the extraordinary general meeting of Barlo scheduled for 11 a.m. today in Dublin's Shelbourne hotel.

The company's chairman, Mr Niall Carroll, and the sole independent director, Mr John Farrell - who recommended the 40 cents a share bid from management that was trumped yesterday by Mr Seán Quinn's surprise 48 cents per share offer - will have some explaining to do if they do not adjourn the meeting first.

Equally, the executive directors who mounted the MBO, led by chief executive Dr Anthony Mullins, have been left looking flat-footed and more than a little greedy.

The meeting had been called to approve some elements of their offer, which is now dead in the water. But had Dr Mullins's plan succeeded it would have been a carbon copy of the sort of public-to-private deals that characterised the bear market of the last few years, including the taking private of Riverdeep, Alphyra and Eircom.

Institutional shareholders would have accepted a low price to exit an unappealing situation and small investors would have been forced to go along. The new owners would have then reaped the benefits of the economic upturn.

More by accident than design, Mr Carroll and Mr Farrell appear to have thwarted this by dragging the MBO process out over nine months. The ensuing recovery in the markets and change in sentiment has made the 40 cents offered by Dr Mullin look opportunistic, and the 30 cents he offered last June positively derisory.

Two people, at least, saw an opportunity in the mismatch between what the company was worth and what Dr Mullins was prepared to pay. Mr Dermot Desmond's IIU saw a classic arbitrage opportunity and Mr Quinn saw a chance to expand his diverse cement-to-stockbroking empire. IIU moved quickly, mopping up shares at around 42 cents to take its stake to 19 per cent, and in the process putting itself in a position where whatever happened next it would be the pivotal player.

Quinn Group would appear to have only decided recently to take a tilt at Barlo via its Sarcon vehicle. One must assume that out of choice Mr Quinn would not have agreed to pay Mr Desmond 48 cents for shares that he could have bought himself for 42 cents or even less six months ago.

The scant detail in Sarcon's statement indicates that Quinn group "intends to fully develop all the existing operations" but at the same time delist the company. The detail may not have been worked out but the key will be the company's strong free cash flow which Merrion Stockbrokers estimate to be up to €17 million a year.

This should allow the group pay down its significant debt and when combined with the rationalisation implemented over the last few years and the benign economic outlook mean the company could achieve earnings of €45 million within three years. Merrion estimates that the company is currently worth up to 55 cents, leaving a bit of fat for Mr Quinn and a sour taste in the mouth of Dr Mullins.