United's uncontested MAI merger costs pounds 30m in fees

The proposed pounds 3bn merger between United Newspapers and MAI will cost pounds 30m in professional fees and stamp duty, it emerged yesterday. The payment, considered high for an uncontested bid, is bound to raise questions about the cost of what is being seen as a purely defensive merger.

The fee details, which amount to more than double the estimated pounds 14m UniChem would have had to pay for advice and other fees on its agreed bid for Lloyds Chemists, emerged in the official documentation for the transaction issued yesterday.

The paperwork also showed that Graham Wilson, former managing director of United News & Media, is to receive almost pounds 600,000 in compensation for loss of office.

Mr Wilson has a service contract dating from March 1992 which provides a salary of pounds 290,000 on two years' notice. United has agreed to pay him pounds 588,373.

Following the merger Lord Stevens will become chairman of the enlarged group, with Lord Hollick taking over as chief executive.

United is being advised by Hambro Magan while MAI's advisers include Kleinwort Benson and Botts & Company.

Sources close to the merger said last night they were increasingly confident that there would not be a counter-offer from Carlton Communications, which stories in last weekend's press suggested might be planning a swoop on MAI.

Although MAI's shares continued to trade at a premium to the value of the bid, the gap has narrowed in recent days as the market has focused on possible regulatory problems surrounding a Carlton offer.

There are two potential obstacles. The Broadcasting Bill proposed that no group should have more than 15 per cent of viewing and the Fair Trading Act could prompt a referral over Carlton's advertising share.

At yesterday's United share price of 632p, the bid values each MAI share at 404p compared with the 422p at which they closed last night. Carlton has consistently refused to comment on the bid rumour.