The Takeover Panel ruled on Friday that diamond magnate Simon Glick’s involvement with the Morgan Stanley consortium bidding to take over Canary Wharf does not contravene its regulations.
It said that Glick, who has a 14.5% stake in the Docklands estate, could be considered as a “joint offeror” for Canary Wharf, after dismissing an appeal from rival bidder Brascan.
Brascan had complained that Glick was a shareholder who has agreed to sell out to the Morgan Stanley bid consortium, rather than a joint bidder intending to take over the company.
Brascan, which holds 9% of the company, recently submitted an offer to buy the company at 252p per share.
It complained that Glick was a shareholder who has agreed to sell out to the Morgan Stanley bid consortium, rather than a joint bidder intending to take over the company.
Brascan protested that his status as a shareholder belonging to the consortium was “not consistent with the status of joint offeror … in effect (it) would provide disguised incremental consideration to Glick.”
The Takeover Panel noted that the consortium agreement provides for Glick to receive shares of a special class which will have some “preferential rights as to income and capital.”
But it also noted Glick’s long historical involvement with the company and the fact that Canary Wharf is Glick’s largest investment.
Glick is also closely involved in the evolution of the company’s business plan and there is no provision for him to make a short-term exit from the consortium, the Panel said.
In reaching its decision, the panel said “a genuine offeror is a person who, alone or with others, seeks to obtain control of an offeree company and who, following the acquisition of control, can expect to exert a significant influence over the offeree company.”
The panel concluded that provisions made to Glick are “not incompatible with Glick’s status as joint offeror. They are therefore not to be regarded as special treatment to Glick (as a shareholder).”
References: EGi News 21/11/03
