The Crimean legislature voted 52-0 with one abstention to abandon plans for a referendum next month on the

The Crimean legislature voted 52-0, with one abstention, to abandon plans for a referendum next month on the constitution, which was

declared invalid by the Ukrainian parliament in March AP. BY RUSSELL HOTTEN

British Aerospace yesterday triggered the start of what is forecast to be a bitter takeover battle for VSEL with an opening offer valuing the Trident submarine maker at pounds 678m.
Lord Weinstock’s GEC was said to be weighing up its response but was confidently expected to fire back with an all-cash offer around pounds 18 a share.BAe’s terms are 3.3 of its shares for every VSEL share, which at yesterday’s opening prices valued VSEL at pounds 17.47 per share. A cash alternative of pounds 16 per VSEL share is also on offer.BAe’s cash terms are pounds 2 higher than the revised pounds 14 offered after GEC intervened in what was originally an agreed deal with VSEL last October. The consensus among analysts was that the renewed bidding could go over pounds 20 a share.BAe’s chief executive, Dick Evans, said: “We continue to see considerable benefits in extending our prime contracting capability across the naval arena. It will strengthen BAe’s position as western Europe’s leading defence company.”Apart from diversification, the aircraft, missiles and munitions maker is also after VSEL’s substantial cash mountain to strengthen its own weaker balance sheet.

The deal is also driven by BAe’s wish to shelter VSEL’s profits behind its own tax losses after a series of huge write-offs in recent years.GEC already owns Yarrow shipyard, which is why its offer was referred to the Monopolies and Mergers Commission last December, but it wants to prevent BAe getting hold of a big shipbuilding operation.GEC has until 13 June to make an offer but was not expected to make any immediate response. Analysts said GEC would have to open at around pounds 18 a share in cash, as BAe had received positive noises from institutional investors willing to accept the company’s paper terms.BAe shares have risen almost 30 per cent since its first offer last year. GEC could take a profit of pounds 10.6m on the 13.99 per cent holding in VSEL it bought during a dawn raid in November.In last year’s bidding, BAe raised its cash offer from pounds 11.40 to pounds 14 a share, to match the rival all-cash bid from GEC, and lifted its main share offer from 2.747 to 3.3 BAe shares for every VSEL share.But BAe’s share price raced ahead this year on improved financial prospects, closing 6p down yesterday at pounds 5.24p, against pounds 4.45 just before it made its revised offer last year. Yesterday’s closing price values BAe’s paper offer at pounds 17.29 a share.

VSEL was up 4p at pounds 17.90, while GEC rose 3p to pounds 3.20.GEC has heavily criticised BAe’s corporate record in recent submissions to the Monopolies & Mergers Commission and is expected to continue these attempts to undermine BAe’s share price.Although Lord Weinstock is an acknowledged corporate miser and unlikely to pay over the odds for VSEL, others say the group is as vital to GEC as it is to BAe and victory is critical.Sandy Morris, of NatWest Markets, said: “On reflection, VSEL is of such strategic significance that GEC should be prepared to pay a blocking price.”The outcome of the takeover battle could determine who emerged as Britain’s leading defence contractor, he said. “I see the end game arising somewhere over pounds 20 a share.”Another analyst said dilution for BAe came at a bid price of around pounds 20-pounds 21 a share, with some small dilution for GEC at pounds 18.50 to pounds 19.BAe wants to expand into the naval business where, as a prime contractor, it could control defence projects, and hence margins.The tax-break benefits from a VSEL takeover could see corporation tax of the combined group fall to 25 per cent from 33 per cent, and VSEL’s cash would strengthen BAe’s balance sheet. But VSEL is also seen as vital for GEC’s strategy to control the defence industry and in a possible eventual bid for BAe itself. VSEL is also in line for Trafalgar class submarine orders worth pounds 2.5bn.BAe and GEC have up to 28 days from the day they bid to send out formal offer documents. Mr Thomas, a former director of consumer affairs at the OFT and the author of a book on plain English for lawyers, calls the new regulations “the most important piece of consumer law for more than 10 years.”For the first time,” he says, “fairness enters the legal relationship between businesses and consumers.”The regulations extend the scope of the existing legislation (the 1977 Unfair Contract Terms Act), which largely applies only to so-called exclusion clauses, which it either forbids or allows as valid only if reasonable.

“There is a lot of work being done in a lot of sectors where businesses really are trying to improve their contracts.”The Association of British Insurers, for example, has published guidelines on the new regulations for the insurance industry and the DTI itself has a draft guidance in the pipeline.Clifford Chance has also published a memorandum for clients, under the aegis of the director of its public policy group, Richard Thomas. It attempts to disclaim all responsibility: “I have and do hereby fully assume all risk of illness, injury or death, and hereby release and discharge [the company] and its agents and associates from all actions, claims or demands for damages resulting from my participation in the trip.”But Ms McKechnie is swift to point out that not all is doom and gloom. The two women (Marion Breckwoldt and Inka Friedrich) have arranged a sexual assignation in the toilets with – yes, you guessed it – a bear and an elk.The strength of this production is the explosive mix and match of Jelinek’s witty and anarchic text and Castorf’s directorial style, culminating in a performance of awesome vitality. Where your attention is drawn to some defects, it does not mean that other defects may not exist”).The “most shocking clause” found by the CA was in the brochure of a US cycling travel company selling via a UK agent. I’m going to go on and on.”Examples of contract terms that the CA considers unfair include a tour company that apparently disclaims responsibility for everything: “Unless specifically indicated, nothing shown in this brochure or other publication (supplied by us or not) constitutes a condition or term of this contract, or shall be relied upon in any way.” (This is nonsense and has no legal standing, says the CA.)Standard survey forms are infested with disclaimers “like an attack of dry rot in an old house” (eg, “You must not assume that if defects are not mentioned in the report, all parts of the structure are free from defect. The world premiere of this play at the Akademietheater in Vienna last year, directed by Claus Peymann, was played “realistically” – an impossible enterprise, I would have thought.The two men (Stephan Bissmeier and Bernhard Schutz) recite Goethe’s The Sorcerer’s Apprentice, at first like schoolboys, then, gradually gripped by the drama of the tale, to great comic effect. The bear and the elk (Carolin Mylord and Gustav-Peter Wohler) have a philosophical discussion; later the elk enters alone, trailing a Barbie doll on wheels behind him.