Harris's Carpetright offer stays at £850m

The founder of Carpetright, Lord Harris, revealed yesterday that he had not cut the price of his £850m takeover offer as he reported a 3.4 per cent fall in like-for-like UK sales at the retailer during the first half.

Shares in the company jumped 6 per cent on relief that Lord Harris's consortium had not walked away or reduced its proposal. Carpetright said the management team was completing due diligence and a further announcement would be expected in January.

The company posted a 4.6 per cent rise in underlying pre-tax profits yesterday to £27.2m in the 26 weeks to October, but said the business had suffered from weak sales in October in the UK, partly due to the fall-out from the banking crisis.

"We have had a very poor October, which we think is partly due to the Northern Rock situation as people were worried... but we have seen a massive improvement in November," Lord Harris said, adding: "The most significant risk for the second half is the economic conditions in the UK, and we expect the rest of the year will be challenging, although the second half has started strongly."

Despite this, he said the company can benefit from difficult conditions. "People are not buying new cars or moving home, so instead will spend £300 on a new carpet," he said.