Greycoat/PHIT: the heat is on
The battle between Greycoat Group and Property Holding & Investment Trust is becoming increasingly bitter. Greycoat put out its formal offer on Tuesday evening, which suggested that an agreed merger would have been possible but for PHIT’s chairman, Arthur John.
Detailed discussions during the last few weeks broke down, according to Greycoat’s Geoffrey Wilson, “in particular (over) your chairman’s desire to remain in an executive rather than a non-executive capacity, having expressed his intention to retire in two years’ time at the age of 75”.
Mr Wilson also tells PHIT shareholders that he is convinced that the “fusion” of the two could bring about the creation of one of the most dynamic asset growth groups in property.
He maintains that, allowing for a proper time-scale to deploy resources of the enlarged group, it would increase the growth of assets per share. He also underlines the prediction that the merger would enable the present rolling development programme of around £350m to be built up and maintained at a size of some £500m to £700m.
Mr John seems only an opportunist trying to acquire assets at a knockdown price. He maintains that the breakdown was not because he wanted a hand in running the show, but because Greycoat kept moving the goal-posts during negotiations.
The market sees the question solely as one of price, as is indicated by the premium of the market price over the value of the Greycoat offer.
