Reichmann's group cuts Canary Wharf bid

NEW YORK - A day after Canary Wharf's administrators expressed some optimism about the development's future, the leading contenders to buy the London Docklands complex have slashed their tentative bid by almost a third, writes Larry Black.

The investment group, assembled by Paul Reichmann, head of Canary Wharf's bankrupt Canadian parent, cut its offer to pounds 235m from pounds 350m, citing the withdrawal of some lead tenants and doubts about the new Jubilee Line Underground link.

Three well-known New York investors - Sandy Weill, Laurence Tisch and Lewis Ranieri - are lending their names to Mr Reichmann's attempt to regain control of Canary Wharf, which consumed more than USdollars 3bn (pounds 1.5bn) of Olympia & York's money before it was forced into the hands of receivers in May. The administrators said on Wednesday that the Reichmann proposal was the most advanced of the 10 they had received.

Sources close to the group's investment bankers complained yesterday that Chemical Bank was threatening to abandon plans to relocate its London offices to Canary Wharf.