Uniliver Ireland has moved to buy out the minority shareholders in Lyons Irish Holdings with an offer of 60p per share in addition to the original offer of 323p per share. The offer has been recommended by the Lyons board. If it is accepted by the 1,170 shareholders, Lyons Irish Holdings, as a fully-owned subsidiary of Unilever, is expected to be removed from the Irish Stock Exchange official list.

Unilever made an agreed offer to the shareholders who own 19.2 per cent of the tea group of 323p per share in cash plus a special dividend of 60p per share if the offer is fully accepted.

The cash offer plus the net amount of the proposed special dividend values Lyons at £114.9 million. Because the special dividend will be paid to all shareholders, Unilever will get about 80 per cent of that pay-out.

The latest offer is effectively a price of 383p per share, a premium of 53p on the last traded price of 330p. Unilever originally offered the minority shareholders the 323.3p per share price it acquired 75 per cent of Lyons from Allied Domecq in July 1996.

That offer allowed Unilever to increase its stake in Lyons from 75 per cent to 80.8 per cent. But it was rejected by most of the minority shareholders on the grounds that it did not reflect the value of their stake in the company.

At that time Unilever said that it was offering a fair price which reflected Lyons strong position in a mature market. Lyons manufactures and distributes tea bags and packet tea and has about 56 per cent of the Irish tea market.

Unilever acquired the 75 per cent Allied Domecq stake in Lyons for around £74 million. That deal was approved by the Competition Authority after Unilever agreed to withdraw its Liptons brand from the Irish market - as Liptons accounted for about 5 per cent of Irish tea sales the combination with Lyons would have given Unilever about 61 per cent of the market.

At that time the 323.3p offer price was a 6.7p discount on the Lyons share price in January 1996 when the deal was announced. The 323.3p offer to the minority shareholders in July 1996 was a 1.7p discount to the then Lyons share price. The Lyons board took independent advice before it recommended that the minority shareholders reject the offer. Unilever needed acceptances from 80 per cent of the minority shareholders by value and 75 per cent by numbers to compulsorily acquire the shares.

Lyons last week reported a drop in pre-tax profits from £8.5 million to £7.95 million for the year to end August.