AGA Rangemaster Group PLC Tuesday said it has received an approach regarding a possible cash offer for the company from US home appliances firm Whirlpool Corp.
But Aga said it was still backing the 185p-a-share offer made by American kitchen equipment firm Middleby in the absence of any firm bid from Whirlpool.
Aga, which has seen a drop in demand for its 7,000 pound ($10,780) enamelled cast-iron cookers since the downturn, accepted a $201 million offer from Middleby in July, saying it could benefit from the U.S. firm’s global distribution network.
Shares in Aga surged by as much as 12 per cent after news of the possible, higher bid broke.
Aga said it would hold talks today with the UK’s Takeover Panel to set a deadline by which Whirlpool must announce a clear intention to launch a formal bid or withdraw.
Aga’s shareholders will be licking their lips at the sight of a potential bididng war, but its board is remaining unruffled for now.
Whirlpool, which makes around £13 billion in sales a year, employs 100,000 staff and has 70 manufacturing and research centres worldwide.
The takeover battle comes after Aga appointed advisers Rothschild to help assess “development opportunities” for the business at the start of this year.
Those included retaining manufacturing in the UK and, crucially, detailed plans to deal with Aga’s massive pension deficit which stood at £84 million at the end of past year.
Though Aga’s eponymous ovens were originally invented by Swedish physicist Gustaf Dalén, they began to be manufactured under licence in Britain in the 1930s and have since become something of a middle class icon. The Aga part of the business was split from the rest of the company in 2001.
The sale of Aga, which traces its history back to 1939, to U.S. food service company Middleby was due to be approved by shareholders on September 8.
The firm said this meant that it would press ahead with the Middleby takeover, which values it at £129 million, to give shareholders the certainty of that bid even if Whirlpool were to walk away.