Dawn raid on MGN likely
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Your support makes all the difference.ONE of the groups lining up to buy Mirror Group Newspapers is considering launching a dawn raid when the shares are relisted tomorrow morning to buy itself a large stake in the company.
If successful, the strategy would put the bidder in a powerful position when negotiating with Arthur Andersen, the administrator of the Maxwell private companies, which controls 54.8 per cent of MGN's shares.
The shares are to be relisted after today's shareholders' meeting. It is understood that the Stock Exchange will analyse any comments made at the meeting to see whether MGN will have to issue a further statement to coincide with the relisting, but it is hoped nothing will occur at the meeting to postpone it further.
City analysts are expecting the shares to open at between 40p and 50p as market makers are wary of being left with shares in a collapsing market. One senior analyst said there was a large fed-up factor, with shareholders tired of the problems in MGN just wanting to get rid of their shares.
At least one potential bidder has identified this as an opportunity to put pressure on Andersen.
The strategy is not without risks. A dawn raid would have to be priced at around 60p a share to attract much support. Though it is thought this would be a low price for MGN shares, the risk of impending litigation and uncertainty surrounding the ultimate cost of repairing the damage inflicted by Robert Maxwell make it difficult to assess the value of the company.
Arthur Andersen has had 15 approaches to buy its holding. Of these, four have come to light - a buyout team led by Richard Stott, editor of the Daily Mirror; the Irish group Independent Newspapers, led by the Heinz chief, Tony O'Reilly; a consortium that Hambros Bank is trying to put together; and Conrad Black, chairman of The Telegraph, who might not be allowed to buy MGN.
The High Court has refused to lift an order requiring Mark Haas, executive director of the US securities group Lehman Brothers, to submit to questioning by Robson Rhodes, liquidator of Bishopsgate Investment Management, in its efforts to trace millions missing from Maxwell pension funds.
The oral examination of Mr Haas, largely regarding stock lending agreements, will go ahead in private before a deputy registrar at the High Court today.
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