Bidding War Looms for Mirror Group

David Montgomery's sudden resignation as chief executive of Mirror Group has raised the stakes for a potential takeover by Trinity International Holdings. Montgomery's departure, after two weeks of infighting with the board, has paved the way for an enhanced offer by the rival bidder. The move is expected to spark a bidding war, with Trinity's share price rising 12p to 461 1/2p yesterday.

Key Takeaways:

David Montgomery resigned as chief executive of Mirror Group after being opposed by the company's six non-executive directors, including Sir Victor Blank and Alan Clements.
Montgomery's decision to resign was influenced by his failure to persuade Clements to support him and the views of the executive directors.
John Allwood, a former Mirror finance director, has taken over as group chief executive, with Sir Victor Blank describing him as "first-class".
Phillips & Drew, the largest Mirror shareholder with a 22% stake, has made it clear that Montgomery was a barrier to an improved offer by Trinity International Holdings.
Regional Independent Media has made a 200p a share cash offer worth £913 million, plus £500 million in debt, to purchase Mirror Group.
Trinity International Holdings is waiting for more detailed financial information from Mirror before making a higher offer, which could happen in about ten days.
City analysts believe that Mirror Group is worth 225p a share.
A takeover by either Trinity or Regional Independent Media would be referred to the Monopolies and Mergers Commission.

Statistics:

Montgomery resigned after two weeks of infighting with the board.
Trinity's share price rose 12p to 461 1/2p yesterday.
Mirror shares rose 1 1/2p to 208 1/2p yesterday.
Mirror shares traded at 137p in October.
Regional Independent Media's cash offer is worth £913 million, plus £500 million in debt.
Trinity International Holdings' all-share offer was worth about 160p a share.

Sources:

The Times, 1999
Phillips & Drew
Trinity International Holdings
Regional Independent Media