Singing

4 December 2014 By Chris Hughes

Qatar Investment Authority and Brookfield Property have gone hostile with a raised 2.6 bln stg offer for Songbird, owner of London’s easterly finance district. Bypassing the board is not how to buy key UK infrastructure. And the 34 pct premium ignores the Wharf’s trophy status.

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Qatar’s sovereign wealth fund and a North American investor have upped their joint bid for Songbird Estates, the owner of London’s Canary Wharf financial district, with an offer that values the company at 2.6 billion pounds ($4.1 billion).

Last month Songbird rejected an initial approach worth 295 pence a share, or 2.2 billion pounds, from the Qatar Investment Authority and Brookfield Property Partners, saying it significantly undervalued the group.

The new all-cash offer of 350 pence per share came just hours before a deadline to submit revised bids and represents a 33.6 percent premium to Songbird’s closing share price on Nov. 5, the day QIA and Brookfield made their initial approach. Songbird shares closed down 1.1 percent at 328.5 pence.

Four large investors own more than three-quarters of Songbird’s shares: the QIA holds 28.6 percent, New York investor Simon Glick has 25.9 percent, China Investment Corp has 15.8 percent, and Morgan Stanley holds 8.5 percent.

In turn, Songbird owns 69.37 percent of Canary Wharf Group, its main operating subsidiary. Brookfield owns 22.08 percent, and Franklin Resources owns 7.1 percent.

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