Swiss gatecrash Domecq's Oz deal

RIVAL Swiss bidder Hess Group today upped the stakes with drinks giant Allied Domecq in the battle for Australia's Peter Lehmann Wines.

Hess increased its offer by 35 cents to A$3.85 a share for the Barossa Valley winemaker, matching Allied's bid yesterday, and valuing the firm at A$143.6m (£59m). Hess said it would scrap the 35% minimum acceptance condition in its original bid.

Allied had promised to make a higher offer worth A$4, or A$149.2m, but only if it could get the support of shareholders owning 90% of PLW.

Its ability to deliver on that promise has, however, run into difficulties with PLW founder Peter Lehmann, who holds a deal-blocking 10.5% stake, as he has indicated he favours Hess. He has already sold 5.4% to Hess.

Allied, PLW's biggest shareholder with 14.5%, said today it was 'concerned to determine, in the interests of all shareholders, the best way in which PLW can maximise its future potential'. It is taking advice from US bank Goldman Sachs.

Three of the six independent directors at PLW yesterday backed Allied's offer but that was before Hess's latest bid, made after Australian markets closed today.