FFW steals a march on Lawrence Graham as Londis switches firms

Lawrence Graham as Londis switches firms” />Convenience store group Londis has dropped Lawrence Graham in the middle of its takeover battle.

Field Fisher Waterhouse (FFW) has replaced Lawrence Graham following a recommendation from Londis’s financial advisers KPMG Corporate Finance, an established client of FFW.

Lawrence Graham scooped first-time instructions from the convenience store chain earlier in the year after a recommendation from Londis’s usual corporate law firm Dickson Minto, which was already advising its management.

The board has just accepted a revised £60m bid from Irish food group Musgrave, which owns Budgens, but an initial bid from Musgrave had failed and Londis replaced its financial advisers Baker Tilly with KPMG.

Londis then changed its senior management and Peter McNamara was appointed vice-chairman and acting chief executive. In addition to the recommendation from KPMG, FFW had advised McNamara at
his previous company Wesleyan Assurance Society.

The fight to take control of Londis took an unexpected turn this week, when the Lancelot consortium launched a bid to buy 40 per cent of Londis, which it claims offers better value than Musgrave’s offer. Lancelot is a consortium set up by four former directors of T&S Stores, a convenience chain acquired by Tesco.

Icelandic bank Kaupthing is financing Lancelot and has appointed Slaughter and May corporate partner Kathy Hughes and finance partner Simon Hall to advise on the bid. Slaughters has advised the bank on a number of deals, including its equity and debt financing for the buyouts of Huurre Group Oy and of Oasis Stores.

The new board of Londis has now spent almost six months considering a number of offers, and seemed settled on Musgrave’s offer, but Lancelot is hoping Londis’s 2,000 shareholders (Londis shopkeepers) will reject Musgrave.

The Musgrave offer needs the backing of 75 per cent of Londis’s shareholders, because it is by a scheme of arrangement. However, the Lancelot bid requires only 51 per cent of shareholders to accept under the Takeover Code.

Former T&S executive Geoff Purdy, who is leading the Lancelot bid, told The Lawyer: “We thought we had a very clever offer for the shopkeepers. It’s hostile because the board won’t talk to us. They’re doing everything they can to suppress and rubbish our offer.”

However, McNamara said: “This proposal from Lancelot offers uncertain value and fails to match the criteria determined by shareholders [which is] used to make that decision.”