Oberthur steps up bid for De La Rue

An improved offer from French company Oberthur of £926 million for De La Rue still undervalues the bank note printer, the group has said.

Over the weekend the Paris-based firm increased its first offer from 905p to 935p a share, after it is believed to have received backing from US buyout firm Bain Capital for the bid.

The approach was firmly rejected by De La Rue, which has encountered continued fall-out from production problems earlier this year.

A "put up or shut up" deadline of February 7 has been set for Oberthur by the Takeover Panel.

The production problems cost former chief executive James Hussey his job, wiped 10% off the value of the company's shares and has cost the group a total of £35 million to date.

Oberthur, a 170-year-old company, has increased pressure on De La Rue since its first indicative offer, calling for a clearer picture of the production problems and full details of the issues which arose with a "principal customer", understood to be the Reserve Bank of India.

De La Rue, which prints notes for the Bank of England and 150 other countries, said in its half-year results in November that volumes were set to drop 20% this year following the crisis, which caused it to suspend production and a shipment of the affected banknote for two months.

The impact on full-year accounts is still unknown.

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