£445m offer for retailer DFS doomed

INVESTORS in furniture retailer DFS have signalled that they will reject a £445 million offer by company founder Lord Kirkham to take the company private.

Kirkham, 59, announced ten days ago that he was considering a bid for DFS at 415p a share.

The company's three non-executive directors, Mike Blackburn, Malcolm Walker and Kevin Morley, met DFS's financial advisers from Citigroup and Deutsche Bank on Friday.

And the directors were told that almost without exception, institutional investors had said they would accept no less than 450p - 10p more than Friday's closing share price. But insiders in the Kirkham camp are arguing that their bid, which would be financed in part by Japanese bank Nomura, is reasonable.

They maintain that it puts the company on a similar rating to those of other retailers that went private last year.

Unless the gap can be bridged, Kirkham's plan looks doomed. He and his family own about 10% of the shares.

Kirkham, who launched DFS 35 years ago, is expected to hold talks with bankers from Citigroup this week.

They are also likely to sound out other possible bidders for the business.