Counterbid expected for De Vere

Hotel and leisure club operator De Vere Group agreed to a £723.5 million takeover yesterday but its shares opened above the offer price in anticipation of a counterbid.

De Vere, which first announced on March 23 it had received a takeover approach, said in a statement AHG Venice Ltd's offer was worth 825 pence per share.

De Vere shares opened 3.1 per cent higher at 840 pence after private equity group Permira said in a statement it was considering making a bid for De Vere and urged the hotelier's shareholders to take no action on the AHG offer.

Bid rumours have surrounded De Vere since late last year.

AHG chairman Richard Balfour-Lynn said: "De Vere is complementary to our existing hotel and conference business and we believe our considerable experience in leisure and property management will help develop the De Vere business".

De Vere non-executive chairman David Richardson said: "The cash offer is an attractive price for shareholders, representing a premium over the share price prior to the bid speculation and reflecting the potential from the strong Village pipeline".

On May 17, De Vere reported a slight decline in first-half profit following the sale of its Belfry golfing resort. Total turnover at its De Vere Hotels and Resorts division fell 12 per cent to £73.5 million in the six months to March 26, reflecting the disposal of the Belfry in March 2005.