More than 60 per cent of Fitzwilton shareholders are now believed to be in favour of the £135 million bid by Dr Tony O'Reilly and his brother-in-law, Mr Peter Goulandris for the company and the offer is likely to be supported by all major shareholders.
The bidders have also promised to expand Fitzwilton's 50 per cent joint venture with Safeway and spend up to £200 million sterling on new retail sites in the Republic and Northern Ireland.
The formal offer document from Stoneworth Investments, the vehicle being used by Dr O'Reilly for the bid, was issued yesterday and includes an acceptance of the offer by Phills Drew Fund Management (PDFM), the largest institutional shareholder with 13 per cent of Fitzwilton.
Meanwhile, other sources have indicated that Bank of Ireland Asset Management (BIAM), which has a 10 per cent stake, is in favour of the offer, although it has yet to say so publicly.
The bid is likely to get the support of wealthy investors like Mr Stephen Subotnick who holds 4.3 per cent, Mr Paul Desmarais, who holds 3.3 per cent and the Chiquita chairman, Mr Carl Linder, who has just under 3 per cent.
All three are personal friends of Dr O'Reilly and if they - and BIAM - accept the offer it would bring those in favour to about 61.2 per cent. The O'Reilly and Goulandris families have 27.6 per cent of the shares themselves.
However, before it can achieve its goal of gaining 100 per cent control, the O'Reilly consortium will have to win over the majority of the 72.4 per cent of shares it did not own at the outset. This involves winning the approval of 75 per cent of those shareholders or 80 per cent approval in share value. It could then compulsorily acquire the remaining shares.
The offer involves 50p for every Fitzwilton share and £1 in cash for every preference share. According to the offer document Stoneworth "believes that Fitzwilton's historic level of dividend payment is unlikely to be sustainable".
It adds that taking Fitzwilton private will "allow the company to explore long-term growth opportunities".
