BPY, Qatar Apparent Victors in Canary Wharf Play

LONDON—Brookfield Property Partners and the Qatar Investment Authority appear to have won their campaign to acquire the Canary Wharf complex here. The board of Songbird Estates plc, parent company of Canary Wharf Group, on Wednesday advised minority shareholders that its three largest stakeholders aside from QIA were planning to accept the final bid from BPY and QIA, which would value the owner of the 97-acre office/retail complex at about $4 billion. Should the major shareholders accept, the board will recommend that minority shareholders follow suit.

However, in an update to minority shareholders, Songbird's directors made it plain that their assent was reluctant. “The board… continues to believe that the offer does not reflect the full value of the business, its unique operating platform and its prospects,” they wrote, although the directors added that they don't expect a better one to come in by Thursday's deadline to outbid BPY and QIA.

This past November, the board announced a pro forma NAV of 381 pence per share, a figure that factors in parcels that could accommodate another 9.8 million square feet, including 3.3 million square feet of residential. The final offer from BPY and QIA equates to 350 pence per share.

Qatar's sovereign wealth fund is already Songbird's largest shareholder, with a 28.6% stake, while BPY owns about 22% of Canary Wharf Group. If the other major shareholders—including the Glick family of New York, China Investment Authority and Morgan Stanley—accept the offer, the BPY/QIA partnership will have about 86% of Songbird. That falls short of the 90% threshold needed to make the offer unconditional.

A spokeswoman for BPY tells GlobeSt.com the company has no comment. QIA already has a significant commercial real estate presence in London, aside from its ownership of Songbird stock. Among other assets, it owns the Shard office tower, the Olympic Village and Harrods department store.