Six Continents, Osmond Meet; No Match

NEW YORK— The Six Continents’ saga continued on Wednesday with the British lodging and pubs firm still at loggerheads with potential bidder Hugh Osmond, despite a face-to-face meeting in London on Tuesday night between 6C executives and the U.K. entrepreneur. Six Continents maintained its plans to demerge its hotels and pubs business would remain the best deal for its shareholders, who have yet to vote on the proposed plan, which would also return £700 million (US$1.1 billion) to shareholders. That vote will come up at an extraordinary general meeting on March 12. Osmond is close to launching a £5.64 billion (US$8.91 billion) bid for 6C, according to theTelegraph, and met last night with Tim Clarke, the current chief executive who will head the pubs division (Mitchells & Butlers), and Richard North, who will lead the hotels unit (InterContinental Hotels Group) when the demerger is finalized in April. Osmond reportedly outlined his proposals for a cash and shares offer through his bid vehicle Capital Management & Investment (CMI), and some £1 billion to £2 billion (US$1.57 billion to US$3.15 billion) of debt to fund the bid is being arranged by his advisers, Credit Suisse First Boston and Lehman Brothers, according to the report. According to a Reuters report, CMI said the meeting had changed nothing, and that it was still considering making a takeover offer for Six Continents. “[While] the road to cooperation remains barred, at least for the present, the road ahead remains open for us,” said Osmond, the founder of pubs group Punch Taverns and ex-owner of PizzaExpress. Observers expect Osmond will keep and and refinance the pubs business, while selling the hotels and returning the proceeds to shareholders, thus possibly triggering a bidding war by deep-pocketed U.S. and European lodging companies looking to scoop up the 3,300-plus hotels portfolio that includes Holiday Inn, InterContinental and Crowne Plaza. Reports also have Osmond— anxious for Six Continents to postpone next month’s shareholder meeting— prepping for a hostile takeover if 6C rejects his bid proposals, which are expected to be presented at a board meeting later today.— Stefani C. O’Connor