Edinburgh softens to Hermes bid

A £165 million buyout of Edinburgh Fund Managers edged closer after the Scottish-based group said it would consider a revised offer from giant rival Hermes.

Edinburgh's admission appears to signal a thaw in relations between the two groups, which have been at loggerheads since Hermes' first approach in November was rejected as 'derisory'.

Hermes already has a 29.3% stake in its target, and its chief executive Tony Watson holds a non-executive position on its board.

Shares in Edinburgh rose 30p to 567 1/2p after chairman John Wright said the group was now considering the latest Hermes bid, which is said to be worth upwards of 575p per share.

With Wright promising a thorough review of the new offer and suggesting a final deal would have to offer some kind of job protection guarantees, a formal response to the new Hermes offer is likely to take weeks.