A deal between pubs group Spirit and Old Speckled Hen brewer Greene King (LON:GNK) looked done and dusted, as the board of Spirit gave the thumbs-up to a cash plus shares deal that valued each Spirit share at around 109.5p.
On Thursday, after the market had closed, Spirit slipped out an announcement confirming press comment that it had received a preliminary counter-offer from C&C, best known for Magners cider.
Press reports suggest that C&C is willing to offer cash plus shares worth around 115p per Spirit share, with around a third of that being in cash.
The rumoured terms value Spirit at around £760mln and trump Greene King's bid, though the value of the latter's offer has now drifted up to around 113p a share as a result of a rise in Greene King's shares.
Spirit gave no indication of the level of C&C's indicative bid but it did reveal it had rebuffed the approach.
Under City rules on takeovers, C&C will have until November 20 to make a firm offer for Spirit or walk away, known in City parlance as "put up or shut up".
Gaining access to those pubs would be a major strategic win for C&C, which is entirely dependent in England and Wales on selling its wares to third parties.
The Irish firm pioneered the cider over ice craze, and then saw its market dominance eroded by brewers who were able to offer their "me too" products in tied pubs alongside Magners cider.
"An acquisition of Spirit, one of the highest quality pub estates in the UK, would transform C&C and enhance long-term shareholder value," C&C said in a stock market statement on Friday, adding it would provide "a strengthened route to market for C&C's long alcohol drinks brands in the on-trade across England and Wales".
Shares in Spirit Group were poodling along happily at around 104p on Thursday until rumours of the C&C approach emerged late in the day, spiking the Spirit share price, which hit 110p before ebbing a little to close at 106.25p.
Shares in C&C were down 7.6% in mid-morning trading, suggesting the market is expecting the Irish firm to return with a better offer.
C&C's stock market statement certainly conveys enthusiasm for a merger of C&C's drinks portfolio with Spirit's pub estate.
"C&C’s management team is experienced in running a vertically integrated pub and long alcohol drinks business and strongly believe that a combination of C&C’s brands with Spirit’s high quality, well-located pub estate is the most effective way to optimise shareholder returns in a competitive UK market," the company said.