Blue Circle Industries paid 26.8m to advisers to help fend off a hostile bid from Lafarge of France.
Blue Circle revealed the payments yesterday as its reported that pre-tax profits fell to £91.5m from £170.3m over the six months to June 30. There was a 45% increase in operating profits as markets in south-east Asia bounced back.
Chief executive Rick Haythornthwaite said the company was fulfilling all the promises it made in its Lafarge defence document. It was on track to deliver £400m worth of disposals and return a similar amount to shareholders.
The company was also "bang on target" for annual savings of £116m by 2003 . He denied, however, that the Lafarge approach was the catalyst for change, while conceding it had the speed of reform.
He admitted that he would have preferred not to spend nearly £27m on defence but rather use the money for purposes such as further industry consolidation.
Recent talks with Southdown in the US about a potential tie-up had ceased but Blue Circle planned to seek links next year once it had fulfilled most of its own restructuring.
Blue Circle shares remained steady, down 0.25p at 410p, with analysts upbeat about the results. David Taylor of Teather & Greenwood said: "[Blue Circle] are definitely moving in the right direction, with targets being met and trading and cost recovery coming through."
But the "Lafarge tanks are still parked on the Blue Circle lawn", with the the French company retaining 33.2% of Blue Circle. He questioned how the firm would deliver the second tranche of £400m to shareholders without paying an unpopular special dividend or using another buyback of shares which could give Lafarge a higher stake.
Briefing analysts last week, Lafarge said it was still interested in Blue Circle, triggering speculation it would make another bid next year.
