LONDON (ShareCast) - (ShareCast News) - Water company Severn Trent said it was considering its options after Ancala Fornia gazumped its bid for smaller water services provider Dee Valley Group.
The FTSE 100-listed company acknowledged Ancala's offer and said it was continuing to "consider its options" while shareholders in Dee Valley, which is listed on the FTSE Fledgling index, were "advised to take no action in respect of their shares" at the moment.

Ancala, an independent infrastructure investment manager with a focus on investing in the infrastructure sector in the UK, issued a statement saying Dee Valley considered its new bid "fair and reasonable", is in the best interest interest for its shareholders and will recommend the offer, while Severn Trent's proposal has been withdrawn.

On Tuesday Ancala increased its cash offer for Dee Valley by 1p per share more than than Severn Trent's bid to 1,706p per share, which includes a cash offer for non-voting shares at 1,602p, which values Dee Valley at about £78.5m.

This switched the deal to a takeover offer from what was a scheme of arrangement.

In November, Severn Trent agreed to buy its smaller rival for about £78.5m, with 1,705p in cash per share and 1,607p for non-voting shares. This thumped Ancala's initial offer for £71.3m in October.

Shares in Severn Trent were up 2.52% tp 2,276p at 1043 GMT and shares in Dee Valley Group were up 0.62p at 1,712p at GMT.

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