Sugar puts up cash bid for Viglen Technology

Alan Sugar has launched a 24p-a-share cash bid for the remainder of Viglen Technology following his recent stock purchase which upped his stake in the PC manufacturer to 42 per cent.

The entrepreneur announced the bid last week through his investment vehicle Amshold, in which he has a 100 per cent holding. The offer values Viglen at #29.3 million.

Sugar stressed that it was not his intention to delist the company. 'The purchase was made because I believe Viglen is undervalued at this price and, therefore, it was a sound investment,' he said in a statement to the Stock Exchange.

'I believe it is in Viglen's best interests to maintain its listing on the London Stock Exchange and it is not my wish to take the company private,' he added.

But Sugar does not expect his bid to be accepted by shareholders.

Clive Longbottom, strategy analyst at CSL Consultancy Services, said: 'Sugar wants to have sufficient control over Viglen to do things the way he wants, but he doesn't want full control. He has a large stake in the company and is playing down the whole thing.'

Sugar was required to make a full bid for Viglen following his purchase of 10 million shares on 9 October, which increased Amshold's stake in the company from 33.7 per cent to 41.7 per cent.

Stock Exchange rules require a full bid to be made by a shareholder with a holding larger than 29.9 per cent in a company, but Sugar was excused when he was left with a 33.7 per cent stake in Viglen following its demerger from Amstrad in July 1997.