Ritblat joins Canary Wharf bid battle

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The Independent Online

The Fight for Canary Wharf re-erupted yesterday when Morgan Stanley raised its offer for the property group to £1.7bn. The new 292p-per-share offer, which trumps a rival bid from the Canadian consortium Brascan, includes a £125m equity injection from British Land.

The Fight for Canary Wharf re-erupted yesterday when Morgan Stanley raised its offer for the property group to £1.7bn. The new 292p-per-share offer, which trumps a rival bid from the Canadian consortium Brascan, includes a £125m equity injection from British Land.

Canary Wharf's independent directors are supporting the new offer, as is the group's biggest shareholder, the Saudi Arabian businessman Prince al-Waleed bin Talal. Its shares leapt 14.5p yesterday to 292.5p.

British Land, which is run by John Ritblat, agreed to join Morgan Stanley's consortium in return for a 14.5 per cent stake in the bidding vehicle, Silvestor. It will also get its hands on some of Canary Wharf's retail assets and car parks under the terms of a separate joint venture that will be set up if the deal goes through. Nicholas Ritblat, who is in the running to succeed his father as head of British Land, said: "British Land is making a strategic investment in Canary Wharf and will bring to bear its considerable Central London office and UK retail expertise on the investment."

Analysts said the new offer - the sixth formal bid - could end the nine-month takeover battle for Canary Wharf, with Brascan priced out of the running. But the Canadian conglomerate yesterday insisted it was still considering its options.

In bidding 292p per share, Silvestor appeared to have done enough to win round one of Canary Wharf's biggest investors, Franklin Mutual Advisors, which has a 6.8 per cent shareholding. Franklin had promised to support Brascan, unless Morgan Stanley raised its offer to 292p per share. The US fund manager helped to scupper Morgan Stanley's previous 275p-per-share offer by teaming up with the 9.3 per cent shareholder Brascan and Paul Reichman, Canary Wharf's former executive chairman who has an 8.9 per cent shareholding to form a blocking stake.

Because Morgan Stanley has structured its offer as a scheme of arrangement it needs 75 per cent of Canary Wharf's shareholders to back it. The property group revealed this week that it had paid £10.7m in advisers' fees relating to the bid. It has already pledged to pay Morgan Stanley £16m if the two sides fail to agree a deal.

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