TIDMSBD
RNS Number : 9252B
Songbird Estates PLC
12 January 2015
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN
PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD
CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH
JURISDICTION
12 January 2015
Songbird Estates plc (the "Company" or "Songbird")
Ordinary shares of 10 pence each ("Ordinary Shares")
For immediate release
SONGBIRD PUBLISHES RESPONSE CIRCULAR
Further to the Company's announcement on 30 December 2014, the
board of Songbird (other than those directors appointed by Qatar
Holding) (the "Board") announces that it is today publishing its
response circular (the "Response Circular") in connection with the
final offer made by an entity jointly controlled by Qatar
Investment Authority ("QIA") and Brookfield Property Partners L.P.
("Brookfield") to acquire the entire issued and to be issued share
capital of the Company at a price of 350 pence per share (the
"Offer").
For the following reasons, the Board recommends that
shareholders do not accept the Offer at this time.
Value
The Board considers that the Offer does not reflect the full
value of the business, its unique operating platform and its
prospects. The Response Circular sets out in more detail the
Board's reasons for its recommendation and, in particular,
highlights the following considerations:
-- the Offer is at a significant discount of 8.1% to Songbird's
pro forma adjusted net asset value as at 27 November 2014 of 381
pence per share;
-- the Offer gives no value for the potential of Canary Wharf
Group plc ("Canary Wharf Group") to earn development profits.
Canary Wharf Group owns the largest office and residential
development pipeline in London, with 11.5m sq ft to be developed
over the next decade, and has what the Board believes to be one of
the best teams in Europe to deliver these developments;
-- the Offer gives no value for the growth potential of the
existing Canary Wharf estate owned by Canary Wharf Group (the
"Estate"). Canary Wharf Group's investment portfolio and
development businesses are poised to capitalise on the positive
market conditions and rental growth forecast for the coming years;
and
-- the Offer gives no value for Canary Wharf Group's control of
the Estate, including managing the entire Estate and ownership of
the largest portfolio of properties on the Estate, as well as 10.1m
sq ft of developable land.
Major Shareholders
The Board believes it is important that shareholders understand
that the Company's largest three shareholders (excluding QIA), the
Glick Shareholder, China Investment Corporation and the MS
Shareholder, each as defined in the Response Circular (together the
"Major Shareholders"), between them control over 50.0% of the
Songbird Ordinary Shares. The Major Shareholders have each informed
the Board that they are continuing to evaluate the Offer and have
not reached a decision on whether or not to accept it.
In the absence of any of the Major Shareholders accepting the
Offer, the Offer cannot achieve over 50.0% acceptances and
therefore cannot become or be declared unconditional. However, if
one or more of the Major Shareholders were to accept the Offer, the
Offer could become or be declared unconditional, leaving any
remaining minority shareholders with a high degree of uncertainty
as to how and at what value they would be able to realise their
investment and with a risk that Songbird ceases to be listed on the
Alternative Investment Market. Therefore, if one or more of the
Major Shareholders were to accept the Offer, this would be a
material new fact which the Board would have to consider in
determining what further recommendation to make to
shareholders.
Recommendation
Accordingly, and subject to the matters set out above, the
Board, which has been so advised by Rothschild, Morgan Stanley and
J.P. Morgan Cazenove, believes the Offer does not reflect the full
value of the business and recommends that shareholders do not
accept the Offer at this time.
David Pritchard, the Independent Chairman of Songbird said:
"Having reviewed the offer document in full, the Board remains
unmoved in its view that the Offer does not reflect the full value
of the business, its unique operating platform and its prospects.
The Offer gives no value for Canary Wharf Group's potential to earn
development profits or for the growth potential of the existing
Estate and fails to take into account the value for its control of
the Estate.
Canary Wharf Group and its world class management team under Sir
George Iacobescu CBE have a long track record of planning,
designing, financing and constructing world class buildings. With
the commencement of four separate development projects delivering
22 buildings over the next 5 years and an overall development
pipeline of 11.5m sq ft, the Board is confident that Songbird will
continue to deliver value to its shareholders."
A copy of the Response Circular will be available at
www.songbirdestates.com.
Enquiries:
Songbird +44 (0) 20 7477 1000
David Pritchard
John Garwood
Rothschild +44 (0) 20 7280 5000
Alex Midgen
Rob Waddingham
Peter Everest
Morgan Stanley +44 (0) 20 7425 8000
Guy Metcalfe
Nick White
Ian Hart
J.P. Morgan Cazenove (Nominated Adviser
to Songbird) +44 (0) 20 7742 4000
Bronson Albery
Mark Breuer
John Mayne
Brunswick Group +44 (0) 20 7404 5959
Simon Sporborg
Rosheeka Field
Forward-looking statements
This announcement contains statements that are or may be forward
looking with respect to the financial condition, valuation, results
of operations and businesses of Songbird, Canary Wharf Group and
their groups (together the "Songbird Group"). Without limitation,
any statements preceded or followed by or that include the words
"believes", "estimates", "forecasts", "plans", "prepares",
"targets", "projects", "anticipates", "expects", "intends", "may",
"will" or "should" or, in each case, words of similar substance or
the negative thereof, are forward looking statements. These forward
looking statements are not guarantees of future performance and
have not been reviewed by the auditors of Songbird or the Songbird
Group. These forward looking statements involve known and unknown
risks, uncertainties and other factors, which may cause the actual
results, valuation, performance or achievements of Songbird and the
Songbird Group, or the industry in which it operates, to be
materially different from any future results, performance or
achievements expressed or implied by such forward looking
statements.
Disclaimer
N M Rothschild & Sons Limited ("Rothschild"), which is
authorised by the Prudential Regulation Authority and regulated in
the United Kingdom by the Financial Conduct Authority and the
Prudential Regulation Authority, is acting exclusively for Songbird
and no one else in connection with the matters described in this
announcement and will not be responsible to anyone other than
Songbird for providing the protections offered to clients of
Rothschild nor for providing advice in relation to the subject
matter of this announcement or any other matters referred to in
this announcement.
Morgan Stanley & Co. International plc is acting as
financial adviser to Songbird and no one else in connection with
the matters described in this announcement. In connection with such
matters, Morgan Stanley & Co. International plc, its affiliates
and their respective directors, officers, employees and agents will
not regard any other person as their client, nor will they be
responsible to any other person for providing the protections
afforded to their clients or for providing advice in relation to
any possible transaction, the contents of this announcement or any
other matter referred to herein.
J.P. Morgan Limited (which conducts its U.K. investment banking
business as J.P. Morgan Cazenove and which is authorised and
regulated by the Financial Conduct Authority in the United
Kingdom), is acting exclusively for Songbird in connection with the
Offer and for no one else, and is not, and will not be, responsible
to anyone other than Songbird for providing the protections
afforded to clients of J.P. Morgan Limited or its affiliates, or
for providing advice in relation to the possible offer or any other
matters referred to in this announcement.
Sources and Bases
For sources of information and bases of calculation please refer
to the Response Circular.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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