US bid onslaught looms for stores

Ward White’s Philip Birch says that he now expects a US finance house to try and outbid Boots in its £800 million offer for his company, and, with a US grouping already bidding for Gateway, analysts belief that there is an American ‘hit-list’ Of potential bid targets.

Burton Group, Kingfisher, Asda and Next are all being cited as attractive candidates for the American enthusiasm for British retailers.

Christopher Roshief, of Drexel Burnham Lambert, believes that “There wiII now be a steady stream of leveraged bids from the US specialists.

“The talk of US funded breakup bids first began a year ago, but it is only with the £2.2 billion battle over Gateway that it has turned into reality.

City pundits say that there are two major reasons for the US interest in UK retailers.

Firstly, the financiers are keen to establish themselves in the UK because of the high level of competition they now face in the US.

Secondly, US retailers are increasingly anxious to establish a European base ahead of 1992.

They fear that, otherwise, they might be excluded from the entire European market.

“It was only a matter of time before money and methods flowed across the Atlantic to take up opportunities of restructuring and leveraging up the companies-over here, says Nick Bubb, of Morgan Stanley.

He believes that Ward White is almost certain to receive a US bid. Sears is another company wh-icp he has predicted as a target.

“There are a lot of Americans with a lot of money walking around the City at the moment,” explains Philip Birch.

He admits that Kohlberg, Kravis and Roberts approached him with the idea of staging a management buy-out recently. He was not interested then, “But times have changed,” he says