Songbird Estates rejects US$4.1 billion takeover bid from Brookfield, Qatar

LONDON – Songbird Estates has rejected an increased takeover offer from Brookfield Property Partners (TSX:BPY) and Qatar Investment Authority, saying the US$4.1 billion proposal still doesn’t reflect the full value of the company, which is majority owner of the Canary Wharf office complex in London.

The revised offer of 350 pence per share cash was a 33.6 per cent premium to Songbird’s share price on Nov. 5, the day before the original offer became public, and up from the previous offer of 295 pence or US$3.5 billion. The Qatari investment group and Brookfield said Thursday that it would be their final offer.

“QIA and Brookfield believe the Songbird Final Offer Price to be full and fair, based on their view of the fundamental value of Songbird’s existing assets, in particular in light of the changing risk profile of Canary Wharf Group, and the substantial premium to Songbird’s pre-approach share price,” Brookfield and Qatar said in a statement Thursday.

It added that it decided to go with a final offer to “avoid a protracted debate on value” of Songbird Estates.

Songbird owns 69 per cent of Canary Wharf Group, which has a number of prime addresses across London, while Brookfield Property Partners holds a 22.08 per cent stake in Canary Wharf Group.

The main tower in Canary Wharf — a major office development begun in the 1980s by Toronto-based Olympia & York — is home to some of the world’s biggest banks.

Brookfield Property Partners is controlled by Toronto-based Brookfield Asset Management (TSX:BAM.A), which led an unsuccessful attempt to acquire control of Canary Wharf about a decade ago.

Brookfield Asset Management has holdings in several industries, including real estate, power generation and forestry-related businesses.

The Qatar Investment Authority has interests across London, including Harrods as well as a 29 per cent stake in Songbird. Qatar is also behind the Shard skyscraper in London.

— With files from The Associated Press.