LONDON (ShareCast) - (ShareCast News) - Dee Valley shareholders should take no action in respect of Ancala Fronia's previous revised bid for the water company, Severn Trent said on Friday.
FTSE 100-listed Severn Trent said if Dee Valley shareholders want to accept its bid "it should take no action in respect of the Ancala proposal, nor should they sell their shares to Ancala".

On Thursday, Dee Valley, which is listed on the FTSE Fledgling index, said that it is to recommend to shareholders that it accept the new £84m bid from Severn Trent.

Severn Trent raised its bid, gazumping Ancala, offering 1,825p per share for Dee Valley shareholders, and a cash offer at 1,713p for non-voting rights.

This is 7% higher than Ancala's previous offer of 1,706p per share and 6.9% higher than the 1,602p for the non-voting rights shares.

Severn Trent said it would be a "supportive long-term owner" of Dee Valley in the area around Wrexham in Wales and south of Liverpool in England.

The company said it will bring its "expertise and considerable financial strength" to support the business, and that its investment grade debt rating will provide a solid foundation for Dee Valley.

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

Shares in Severn Trent were down 0.18% to 2,205p at 1337 and shares in Dee Valley were down 0.77% to 1,806p at 1257 GMT.

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