Managers on tenterhooks as rival ponders increased bid for Scots housebuilder.
The future of Scottish housebuilder Cala hung in the balance this week, with the management team waiting to see if Miller would launch another hostile bid to top its £93.7m offer.

The 10-strong team, led by chairman Geoff Ball, last week offered 190p a share after conglomerate Miller overtook its original bid of 165p with an offer of 175p a share.

After the Cala team upped its offer, Miller released a statement saying it would take no further action while it reflected on the situation. Miller was due to make a further announcement at the end of this week.

Asked if he thought Miller might bid higher, Ball said: "I just don't know. They came in the first place with a hostile bid, they were then surprised by our management buyout bid and I think they will be surprised by the last one. If they did bid higher, they would be paying an awful lot for goodwill and that goodwill could walk out the door." Ball refused to speculate on a possible riposte to a further Miller offer, but said: "We are determined to keep control." Ball rejected claims that the original bid was intentionally low and that he stood to gain a substantial windfall from the proposed buyout by selling more than 1.8 million Cala shares worth £3.4m. "When we launched the first bid we had unanimous word from our institutional shareholders that they were happy with that price," he said. "And if I kept all my shares in the deal, I would be the dominant shareholder, and I did not want to dominate the buyout vehicle." The buyout will leave Ball with a 20% stake if it goes ahead. Members of Cala staff can also subscribe if the deal goes through.

The buyout bid will also see the Scottish construction group Morrison taking a 5% stake in the £5.7m equity in the buyout vehicle for £286 000.

Commenting on the development, Ball said: "Cala have already worked on two very large commercial joint ventures with Morrison, two 100 000 ft2 office blocks in Edinburgh, and we are now working on a residential scheme. We are also looking at schemes in the Midlands, Yorkshire and London. The companies get on well from top to bottom." Keith Howell, group managing director of Morrison, said: "Our motive is very clear. We are showing support for a valued joint-venture partner. It is a modest minority interest and will not involve us having influence over the way the business is run. They will be in control of their own destiny and we are demonstrating support for their desire to stay independent."