Canary Wharf's independent committee is willing to recommend the offer of 265p a share not least because, unlike the previous offer, this one allows shareholders to take the full amount in cash.
But Morgan Stanley described the latest version as an 'alternative', with the basic offer still comprising 220p in cash plus equity in the new Canary Wharf parent company, to be listed on the Alternative Investment Market (AIM). It is the level of equity that has been raised in the new offer, from 35p to 45p.
The opportunity to take the full amount in cash may satisfy some institutional shareholders who had criticised the previous cash-and-paper offer. Many are barred from holding AIM stocks and would have had to sell the equity they received immediately, which could have led to the value of the shares being driven down.
But the Morgan Stanley-led consortium still faces the prospect that rival bidder Brascan, which had its own 252p a share offer for the company rejected last month, could use its 9% stake to block the takeover attempt. Brascan could still submit another offer as could Paul Reichmann, the group's executive chairman.
Reichmann, Canary Wharf's original developer in the 1970s, still owns a 7.7% stake in the company and sources close to him have suggested that he believes he will be able to trump Morgan Stanley's latest 265 pence per share offer in the new year.
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