CITY analysts have criticised the First Choice/ Kuoni offer, claiming it does not generate enough extra cash for shareholders and does not spell out the benefits of the proposed merger.
Cost savings identified in the document amount to between ú10m and ú12m but the merger will cost Kuoni Holdings, should it be formed, ú25m.
One analyst said: “The ú10m to ú12m saving is not perceived to be a sufficient amount to justify the deal and the document really hasn’t done enough explaining. That’s not to say it should not go ahead, its just that the City is always looking for dosh and it is asking ‘where is the extra profit?'”
Another analyst said shareholders held mixed feelings about the deal but major shareholders will have already held discussions with Kuoni and First Choice so the offer document would be telling them nothing new.
As expected, Airtours has launched a counter bid for First Choice (see page 1 and opposite page for further details).
Interested parties have 60 days from April 26 to mount a bid and realistically the stock market would expect a move within 21 days. Airtours made a failed bid for First Choice, then called Owners Abroad, in 1993.