Shopping center owner Intu Properties plc said on Friday it was considering a 215p per share preliminary takeover offer from a consortium led by its deputy chairman John Whittaker, a North of England billionaire, sending it shares 14% higher.
The consortium includes Peel Group, the investment vehicle of the Whittaker family, Saudi Arabia’s Olayan Group and Canadian property investor Brookfield Asset Management and the offer values Intu at about £2.91 billion, a 21% premium to the stock’s closing price on Thursday.
Whittaker’s Peel already owns a stake of roughly 27% in Intu.
Intu’s shopping centres include Manchester’s Trafford Centre, Newcastle’s Eldon Square, Gateshead’s Metrocentre and Glasgow’s Braehead.
In a stock exchange statement, Intu said: “On 4 October 2018 a consortium comprising the Peel Group, the Olayan Group and Brookfield Property Group announced that they were in the preliminary stages of considering a possible cash offer for the company.
“Intu confirms that on 11 October 2018 it received an indicative proposal from the consortium of 205 pence per share in cash, subject to an adjustment for dividends as set out below.
“The independent committee formed by intu (comprising all directors of intu other than John Whittaker, who is connected to the consortium) and its financial advisers met to consider the indicative proposal.
“Following further engagement, on 17 October 2018 intu received a revised indicative proposal from the consortium of 215 pence per share in cash, subject to an adjustment for dividends as set out below.
“The terms of both the initial indicative proposal of 205 pence per share and the revised indicative proposal of 215 pence per share provide that the consideration will be reduced by any dividends or other distributions declared, payable or paid by intu prior to completion including the interim dividend of 4.6 pence per share due to be paid on 20 November 2018 (with an ex-dividend date of 18 October 2018).
“Accordingly, should any offer on the terms of the revised indicative proposal be forthcoming the consideration would be 210.4 pence per share and may be reduced further by any other dividends or other distributions declared, payable or paid by intu prior to completion.
“Both proposals also included a number of pre-conditions and there can be no certainty (i) that any such pre-conditions will be satisfied or waived (ii) that any offer will be made or as to the terms of any such offer or (iii) that any offer, if made, will complete.
“In order to advance discussions regarding the possible announcement of a firm offer, the independent committee has resolved to grant the consortium access to certain due diligence materials. A further announcement will be made when appropriate.
“Intu intends to issue a trading update for the period from 1 July 2018 as soon as practicable, which will include the outcome of an updated independent valuation of the company’s investment and development properties as at 30 September 2018.
“This announcement has not been made with the consent of the consortium.
“In accordance with Rule 2.6(a) of the Code, the consortium is required, by not later than 5.00 p.m. on 1 November 2018, to either announce a firm intention to make an offer for the company in accordance with Rule 2.7 of the Code or announce that it does not intend to make an offer, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies.
“This deadline can be extended with the consent of the Panel in accordance with Rule 2.6(c) of the Code.”