The battle for Marks & Spencer was tonight focused on chief executive Stuart Rose after a third takeover approach from tycoon Philip Green was rejected.

M&S continues to believe a strategy presentation from Mr Rose on Monday will show that Mr Green's interest - now worth £9.1 billion - undervalues it.

Mr Green said tonight he will now wait to study the response of major investors to the M&S review. Analysts believe a lacklustre presentation from Mr Rose could yet swing the struggle in favour of the Bhs boss, who is now offering 400p a share through his bid vehicle Revival.

The latest rejection came as the Financial Services Authority said it was no longer looking into share dealings involving Mr Rose. The inquiry by the City watchdog reviewed the acquisition of 100,000 M&S shares by Mr Rose, just hours after a phone call from Mr Green.

Mr Rose maintains that the call from Mr Green was to invite him to a meeting on May 12 where the entrepreneur revealed his intention to bid for M&S.

Today's offer rejection by M&S was criticised by the tycoon, who expressed surprise at the lack of contact from the retailer's board - particularly as it said there were "a number of major areas of uncertainty" in his proposal.

In a statement, Revival said it was "puzzled" why the board had questioned certain aspects of the approach only after not recommending it.

Concerns were raised by the M&S board at the financing and ownership structure of Revival, while it also sought more details on competition issues and the due diligence that Mr Green wishes to carry out.

Mr Green has so far vowed only to make a formal bid with the support of the M&S board. A firm offer needs to be tabled by August 6.

M&S pledged to show its real worth next Monday when Mr Rose outlines his vision of how to improve its trading performance. New information would be presented to shareholders who would then "be able to make an informed assessment of the board's view", the company said.

This is expected to include more than £100 million of savings from the supply chain, a revaluation of M&S property and initiatives to drive like-for-like sales.

The importance of the strategic review in deciding the outcome of the takeover saga was underlined by only a 1% fall in M&S shares today.

Retail analyst Rhys Williams, of stockbrokers Seymour Pierce, said the response of investors will be crucial.

"We believe 400p is a pretty decent price for this business. M&S will have to come out with all the stops to show why it didn't recommend this offer," he said.

Mr Green has secured the support of US-based Brandes - the largest investor in M&S with an 11.7% stake - for his proposal. Investment bank Schroders, which has a 1.2% interest, has also agreed to sell its shares if he can win a recommendation from the M&S board.

Mr Green added today he was angry at being denied the chance to meet the trustees of the M&S pension fund, which has a £670 million deficit according to the latest annual report and accounts of M&S.

He is anxious to know whether M&S agreed a future funding plan when it injected £400 million into the fund earlier this year.

Friday July 09, 2004