Waterfall Holdings has hit back at European Leisure's rejection of its all-share bid. It said it was surprised the European Leisure board had rejected the offer which "represented a premium of over 36 per cent to the recommended offer from Allied Leisure". Waterfall has asked why the European Leisure board is "so intent on continuing to recommend an alternative proposal that offers significantly less value to European shareholders and why it is still urging them to accept an inferior offer without delay".

European Leisure has formally rejected the £41 million sterling (#61.2 million) from Waterfall. Instead it has again urged its shareholders to accept the lower offer from Allied Leisure.

European Leisure, in its defence, has questioned the real value of Waterfall shares. "The directors of European have serious concerns about the value of these shares and of Waterfall's underlying financial position," the company said.