Fidelity, with 10 per cent, and Foreign & Colonial with 7 per cent, are thought to support the board.”This is just an attempt by a pounds 20m-a-year company to win control of a pounds 150m-a-year rival without paying a premium,” said Mr Stubbs. Tay, which has a market value of around pounds 30m, would seek to improve performance and grow through mergers with rivals of similar size, he said. “We would like a market capitalisation of around pounds 150m through tie-ups with other small housebuilders.”Tay announced that it would scale down its operations in the North-west due to poor market conditions. The shares have been hit hard by the slowdown in the North of England, collapsing from 142.5p in March to 111.5p yesterday.Sunley is understood to have the backing of Phillips & Drew, which owns 17 per cent of Tay. TAY HOMES, a small Northern housebuilder, yesterday angrily rejected proposals by a major shareholder for a complete overhaul of the board. The company said the attempt by Sunley Family Limited to change the management was a “loser”.

Norman Stubbs, the chairman, said Sunley, a privately-owned housebuilder, was wasting its time as the board had enough institutional support to defeat a shareholders’ revolt.
The rebel investor, which owns 10 per cent of Tay, wants to Mr Stubbs and chief executive John Swanson replaced by Peter Hedges, a former deputy chairman at construction group Taylow Woodrow, and Sunley head Richard Tice.The little-known company is seeking to capitalise on some institutions’ anger at Tay Homes’ performance. Co-Steel Inc is one of the world’s largest steel producers: last year it had sales of $1.6bn (pounds 950m) and lost $29.1m.Buying Co-Steel Sheerness would help ASW strengthen its position in the production of steel for building contractors and civil engineers. It is already a leading European player with plants in the UK, France, Holland, Belgium and Italy.Both companies said a merger would not give rise to competition issues as the European steel market is fragmented.. Last year ASW, which derives half its turnover in the UK and half in France, posted profit before interest of pounds 700,000 on turnover of pounds 460m as steel prices fell. Co-Steel Sheerness turned over pounds 150m, mostly in its Kent plant, which has the capacity to produce about one million tons of steel a year.The company, founded in 1971, accounts for around a quarter of its Canadian parent’s annual production.

They added that the two companies operated in the same markets and would be able to extract “massive rationalisation benefits” from a merger.”This is all about the reduction of capacity and the change in the product mix, and has been caused by the current state of the steel industry,” said a person close to the talks.Both groups’ earnings have been savaged by the strength of the pound. They added that a tie-up between ASW, the UK leader in the production of steel for the construction industry, and Co-Steel would lead to a number of redundancies among the enlarged group’s 3,200 workers.Most job losses are set to come from the floors of ASW’s Cardiff factory and Co-Steel’s works in Sheerness, Kent, as the combined group implements large cuts in production.Insiders said ASW’s takeover approach was driven by its need to mitigate the effect of tough market conditions on earnings. The ONS said official retail sales figures were based on a 5,000-strong sample of firms drawn from all parts of the retail sector, and, unlike survey data, were based on cash through the till, rather than comparisons with the previous year’s trading.. ASW, the troubled steel maker, is poised to buy its smaller rival, Co-Steel Sheerness, in a deal which would create an industrial group with annual turnover of more than pounds 500m. Shares in Cardiff-based ASW were suspended at 18.5p yesterday after it said it was in advanced talks with Co-Steel Inc, the loss-making Canadian steel producer, over the acquisition of its UK subsidiary.
Sources said the deal could be completed this week. USHERS OF Trowbridge the regional brewer whose shares were floated in March last year at 110p a share, is set to return to the private sector under its existing management after a chequered career as a public company which cost it an estimated pounds 3.5m in fees. Alchemy, the Guernsey-based venture capital specialist whose initial bid of 117p lapsed after just a fortnight last October after the stock market suffered a sharp fall and the backing finance was withdrawn, returned yesterday with a fresh bid of 112p, which the independent directors have recommended and the main shareholders have agreed to accept.
The offer is 24 per cent above the market price before the initial offer was made on 2 October and 15 per cent above the closing price of 97.5p last Friday.

The shares rose 13p to 110.5p yesterday.Three venture capital groups which hold 49.3 per cent of the shares – Schroders Buy-Out Fund Number 2, SBC Equity Partners and Indelec, an SBC venture fund – have agreed to accept a reduced price of 106p for their holdings in order to bridge a gap between the maximum price the buyout team was willing to offer and the minimum price the independent directors were willing to accept on behalf of the private shareholders.The management team will also sell their 7.7 per cent stake in the company in a separate deal, and surrender their options over a further 1.4 per cent, in return for a package of new shares and loan stock valued at pounds 2.3m plus pounds 6.25m in cash. Their contracts will be unchanged, and the 330 employees have also been given continuity of employmentRoger North, chief executive, said the buyout would give the management greater freedom to run the business and end a period of uncertainly which had led to a drop in the morale of employees and the departure of several key managers.Ushers, which owns the brewery in Wiltshire and an estate of 574 pubs in the Midlands, the South and South-west England and South Wales, was originally part of Grand Metropolitan, but was sold off in 1991 to a management team led by three GrandMet directors.Profits in the year to the end of October rose 29 per cent to pounds 13.4m after exceptional costs of pounds 600,000, on a turnover which increased 17 per cent to pounds 82.3m. In the year to September, Sir Iain received a salary of pounds 914,000, an 11 per cent increase over the previous year.. THE OFFICE for National Statistics (ONS) said it had “absolute confidence” in its retail sales data, following criticism of recent official figures by leading UK retailers. Profits were below market forecasts, reflecting the difficult conditions in the industry, but all three divisions increased their contribution to operating profits, the chairman Tom Vyner said yesterday.The pub estate reported a 14 per cent increase, and 5 per cent on a like- for-like basis, ahead of the UK market average..