Shareholders of Millennium & Copthorne Hotels Spurn Offer From City Developments
December 14 2017 - 9:31AM
Dow Jones News
By Oliver Griffin
A group of shareholders in Millennium & Copthorne Hotels PLC
(MLC.LN) said on Thursday that they have written to the company's
board of directors to say that they won't tender their shares to
City Developments Ltd. (C09.SG), blocking it from reaching the
acceptance threshold of its takeover offer.
The shareholders--comprising International Value Advisers, LLC;
MSD Partners, L.P. and its affiliates, and Classic Fund Management
AG--said they represent an aggregate of 37% of the shares subject
to the offer by City Developments, which they said was highly
opportunistic and significantly undervalued M&C.
City Developments, a Singapore-listed company that currently
owns 65.2% of M&C, made an updated offer to buy the rest of the
hotel company on Dec. 8, valuing it at 2.01 billion pounds ($2.68
billion).
Although M&C's board recommended that the offer be accepted,
the group of shareholders said it fundamentally undervalued the
company, adding that they hoped to see other shareholders also
refuse to tender their shares once the offer is formally made.
The board's handling of the takeover offer raised issues over
its representation of independent shareholders, as well as a number
of corporate governance issues, the group of shareholders also
said.
The shareholders said it was "nonsensical and highly troubling"
that the independent committee of the board has continued to argue
that net-asset value has limited relevance in valuing M&C, and
criticized the board's approach to shareholder concerns about the
low-ball offer.
To overcome these issues, the group of shareholders requested
that more independent non-executive directors be appointed to the
board. They also asked that the company begin publishing the
assessed market value of its assets on an annual basis, among other
measures.
Shares in M&C at 1350 GMT were down 1%, or 6 pence, at 581
pence.
Write to Oliver Griffin at oliver.griffin@dowjones.com
(END) Dow Jones Newswires
December 14, 2017 09:16 ET (14:16 GMT)
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