Leading investors reduce stakes in Canary Wharf

SEVERAL LEADING investors in the Canary Wharf Group announced yesterday that they were reducing their stakes in Britain's biggest office complex.

The pounds 213m move comes as the lock-in period following the group's listing last March expires, and analysts say that further offerings could follow.

The proposed sale also comes just days after the much-delayed opening of the Jubilee Line extension at Canary Wharf, which was seen as helping to boost long-term operations at the complex.

Shareholders including CNA Financial Corporation, the Glick family, Edmond Safra and his Republic New York offered 50.7 million shares, or 7.4 per cent of the company.

Nan Rogers, an analyst at Charterhouse Securities, said: "It makes sense [to trim their stakes]. I remain cynical about prospects for large-scale office developments in London over the coming 10 years."

Canary Wharf floated 25 per cent of the group in March at 330p a share. The stock, which reached a high of 450p last July, ended 7p lower yesterday at 384p.

CNA Financial Corporation offered 20 million shares, a fifth of its stake, while Mr Safra is selling a further 10 million shares, or more than half his holdings in the 81-acre development. The Glick family, which held 97 million shares, is off-loading 10 million.

Credit Suisse First Boston, lead-managing on the deal, said: "[The sale] will meet the company's desire to increase its free float in order to attract new shareholders, increase the marketability of the company's equity and satisfy the demand for shares following the company's entry into the FT-SE 250 Index."

The transaction should net the sellers a sizeable profit. Canary Wharf Group bought the docklands project from its creditors in 1995 for about pounds 800m; it is now worth about pounds 2.5bn.

Not all leading shareholders are reducing their exposure, however. Paul Reichmann, the Canary Wharf chairman, who started the development in the 1980s when he headed developer Olympia & York, is retaining his 11 per cent holding.

Saudi Arabia's Prince Alwaleed Bin Talal, who holds 6 per cent of the equity, is also holding firm.

Credit Suisse First Boston said that there was an over-allotment option of a further 5 million shares. It added that the shareholders paring their stakes were not allowed to make further sales within 30 days.

In a separate announcement yesterday, Canary Wharf said that it had bought Texaco's London headquarters for pounds 82.5m.

The bulk of the 217,000sq ft block at One Westferry Circus, at the entrance to the main Canary Wharf site, will be leased back to the US oil company for pounds 27.50 per sq ft.

The balance will be let to Credit Suisse First Boston.

Canary Wharf said that it would finance the deal with cash on hand, and arrange longer-term financing in the coming months. It did not give details of the length of its lease for the building.

Earlier this month, Canary Wharf announced better-than-expected results for the year to June and said that it would turn a profit by next year.

It reported pre-tax losses of pounds 42.8m, compared with the previous year's losses of pounds 96.3m.

When complete, Canary Wharf will comprise 13.5 million sq ft of grade- A office and retail space. Of this, 8.3 million sq ft, or 61 per cent of the total, is completed, under construction or set to start construction in the coming weeks.

Start your day with The Independent, sign up for daily news emails
Ed Miliband received a warm welcome in Chester
election 2015
Life and Style
Apple CEO Tim Cook announces the Apple Watch during an Apple special even
fashionIs the iWatch for you? Well, it depends if you want for the fitness tech, or the style
Astronauts could be kept asleep for days or even weeks
scienceScientists are looking for a way to keep astronauts in a sleeplike state for days or weeks
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45,000: SThree: SThree Group have been well e...

Ashdown Group: IT Manager / Development Manager - NW London - £58k + 15% bonus

£50000 - £667000 per annum + excellent benefits : Ashdown Group: IT Manager / ...

Recruitment Genius: Sales Consultant / Telemarketer - OTE £20,000

£13000 - £20000 per annum: Recruitment Genius: Scotland's leading life insuran...

Ashdown Group: Training Programme Manager - City, London

£40000 - £45000 per annum + benefits : Ashdown Group: Training Programme Manag...

Day In a Page

NHS struggling to monitor the safety and efficacy of its services outsourced to private providers

Who's monitoring the outsourced NHS services?

A report finds that private firms are not being properly assessed for their quality of care
Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

The Tory MP said he did not want to stand again unless his party's manifesto ruled out a third runway. But he's doing so. Watch this space
How do Greek voters feel about Syriza's backtracking on its anti-austerity pledge?

How do Greeks feel about Syriza?

Five voters from different backgrounds tell us what they expect from Syriza's charismatic leader Alexis Tsipras
From Iraq to Libya and Syria: The wars that come back to haunt us

The wars that come back to haunt us

David Cameron should not escape blame for his role in conflicts that are still raging, argues Patrick Cockburn
Sam Baker and Lauren Laverne: Too busy to surf? Head to The Pool

Too busy to surf? Head to The Pool

A new website is trying to declutter the internet to help busy women. Holly Williams meets the founders
Heston Blumenthal to cook up a spice odyssey for British astronaut manning the International Space Station

UK's Major Tum to blast off on a spice odyssey

Nothing but the best for British astronaut as chef Heston Blumenthal cooks up his rations
John Harrison's 'longitude' clock sets new record - 300 years on

‘Longitude’ clock sets new record - 300 years on

Greenwich horologists celebrate as it keeps to within a second of real time over a 100-day test
Fears in the US of being outgunned in the vital propaganda wars by Russia, China - and even Isis - have prompted a rethink on overseas broadcasters

Let the propaganda wars begin - again

'Accurate, objective, comprehensive': that was Voice of America's creed, but now its masters want it to promote US policy, reports Rupert Cornwell
Why Japan's incredible long-distance runners will never win the London Marathon

Japan's incredible long-distance runners

Every year, Japanese long-distance runners post some of the world's fastest times – yet, come next weekend, not a single elite competitor from the country will be at the London Marathon
Why does Tom Drury remain the greatest writer you've never heard of?

Tom Drury: The quiet American

His debut was considered one of the finest novels of the past 50 years, and he is every bit the equal of his contemporaries, Jonathan Franzen, Dave Eggers and David Foster Wallace
You should judge a person by how they peel a potato

You should judge a person by how they peel a potato

Dave Hax's domestic tips are reminiscent of George Orwell's tea routine. The world might need revolution, but we like to sweat the small stuff, says DJ Taylor
Beige is back: The drab car colours of the 1970s are proving popular again

Beige to the future

Flares and flounce are back on catwalks but a revival in ’70s car paintjobs was a stack-heeled step too far – until now
Bill Granger recipes: Our chef's dishes highlight the delicate essence of fresh cheeses

Bill Granger cooks with fresh cheeses

More delicate on the palate, milder, fresh cheeses can also be kinder to the waistline
Aston Villa vs Liverpool: 'This FA Cup run has been wonderful,' says veteran Shay Given

Shay Given: 'This FA Cup run has been wonderful'

The Villa keeper has been overlooked for a long time and has unhappy memories of the national stadium – but he is savouring his chance to play at Wembley
Timeless drama of Championship race in league of its own - Michael Calvin

Michael Calvin's Last Word

Timeless drama of Championship race in league of its own