Sanctuary fends off Mama's moves.

Groups manoeuvre to gain upper hand in proposed takeover of troubled music operation

by Robert Ashton & Martin Talbot

Channelfly parent the Mama Group vowed that its takeover bid was still alive last Friday, after Sanctuary dramatically slapped down its takeover approach.

On Monday last week, Mama revealed that it had made an informal approach to take over the company on July 14. The revelation elicited no response from Sanctuary - until Friday afternoon.

In a statement issued at 4pm, Sanctuary said it had met with representatives from Mama the day before to hear what they had to say.

But the statement continued, "Following this meeting, the directors of Sanctuary have concluded that the approach from Mama is without merit and is not in the interests of Sanctuary shareholders. Sanctuary has therefore rejected the Mama approach and terminated discussions."

Mama responded to Sanctuary's Friday statement with its own announcement to the Stock Exchange, insisting that "the cursory examination of its proposals by the board of Sanctuary and the dismissal of the approach by Mama Group are not in the best interests of Sanctuary shareholders. Mama Group reserves the right to proceed with an offer without the recommendation of the Sanctuary board."