GlobeSt.com UPDATE: Minerva Ditches $1B Takeover Plan

As GlobeSt.com reported in August, the company had at the time extended by two weeks the original Sept. 16 bidding deadline. According to a company statement, some 15 potential suitors (Morgan Stanley Real Estate Fund, Goldman Sachs' Whitehall Fund, Hines and Resolution Property were rumored to be among them) had been invited to submit first-round bids of about €894 million ($1.1 billion) by that date.

In a statement revealing the strategic turnaround, chairman Sir David Garrard notes that, "With the strength of the direct investment market for individual properties and the improving London letting market, we have a clear strategy for extracting value from the group's assets and the broadening of the portfolio so as to provide further opportunities to increase value for shareholders. Consistent with our stated philosophy, we will also take positive steps to maximize the value of our developments through a combination of pre-leasing and non-recourse finance."

In a separate development, Scarlett Retail confirmed on Wednesday that the Allders department store chain had been placed into administration. Minerva owns 60% of Scarlett Retail. Now the 45 Allders stores are likely to be sold.

A statement by Scarlett Retail officials states that: "Minerva is disappointed by the failure of the sale process and the resulting administration, as it has worked very hard in its attempt to secure the future of Allders as a going concern."

Minerva also sought to scotch speculation about its liabilities in the wake of the Allders collapse. A company statement says it had been advised it was not liable for the pension fund deficit and any actions that may be taken by the new pension regulator was unlikely to succeed.

In addition to the Allders holdings, Minerva's assets comprise a €1.2-billion ($1.4-billion) central London investment portfolio, which includes the 600,000-sf Whitgift shopping centre in Croydon. It also owns the 260,000-sf Criterion building at Piccadilly Circus, SW1; Sampson House and Ludgate House on the South Bank, SE1; and 90 High Holborn, WC1.

There is also a €3-billion ($3.4-billion) development pipeline. The company is currently erecting the tallest building in the Square Mile, has planning consent for the one-million-sf Park Place development site in Croydon which, when fully developed, would create--with the Whitgift--the biggest shopping mall in the country. Minerva also owns the Walbrook/St Swithins site, EC4, which has consent for a 500,000-sf office scheme.