THE battle for Britain's Co-Operative Wholesale Society (CWS) will intensify this week as the two sides square up in the High Court amid an increasingly bitter contest.
A High Court process begins tomorrow to decide what information the bidder, Mr Andrew Regan (31), may use in a hostile bid for the supermarkets-to-funeral parlour group.
In a separate move yesterday, CWS chief Mr Graham Melmoth warned Mr Regan that the Serious Fraud Office (SFO) would be called in if he failed to answer certain questions CWS had over payments it said Mr Regan had made.
CWS faxed Mr Regan a letter yesterday demanding he answer questions concerning payments of over £2 million sterling it said He had made for a company called Trellis, which it linked to his 1994 purchase of CWS's food manufacturing arm.
Mr Regan is planning £1 billion to £1.5 billion bid for CWS, which has a multi-billion pound turnover from businesses ranging from supermarkets to insurance and the Co-Operative Bank.
But the group has struggled to turn its massive revenues into profit.
Last week it announced a £10 million fall in pre-tax profits to £54.1 million for the year to January 11th and Mr Regan is not alone is studying CWS assets.
On Sunday Allied Irish Banks Plc said it was interested in buying the profitable Co-op Bank but denied a deal was already in place.
Retailer J. Sainsbury Plc declined to comment on speculation" that it might buy some of the Co-op's retail outlets.
Galileo Group, a special bidding vehicle, part-owned by Mr Regan's Guernsey-based investment trust Lanica, said last Friday it would propose converting the CWS to a limited company in order to make an offer for the whole group.
But Galileo's immediate ambitions were thwarted after CWS obtained a court order preventing Galileo, Lanica, Mr Regan, his associate Mr David Lyons or a suspended senior CWS manager, from using any confidential information they may have on the group.
Under the terms of the court order they must also provide sworn affidavits by this afternoon detailing what information they have received. The court will then consider the case and has scheduled a hearing for Friday morning.
The court move followed the suspension last Thursday of two senior CWS executives, Mr Allan Green and Mr David Chambers, after allegations of breach of trust.
