UK-listed real estate investment trust (REIT) Hammerson has rejected a takeover proposal from France’s Klépierre.
Hammerson said it rejected the 615p (702.3c) a share proposal on the grounds that it ”significantly undervalues” the company.
A deal would have given Hammerson a market capitalisation of around £4.9bn. Klépierre has a current market capitalisation of around €10.5bn.
The proposal, which was received on 8 March, comprised 50% in new Klépierre shares and 50% in cash.
In December last year, Hammerson and another UK shopping centre owner Intu Properties agreed to merge in a deal that is expected to create a £21bn (€23.8bn) pan-European REIT.
Hammerson said today it remains committed to the acquisition of Intu Properties, which the board continues to “believe will deliver significant value” for Hammerson shareholders.
David Tyler, chairman of Hammerson, said: “The proposal from Klépierre is wholly inadequate and entirely opportunistic.
“It is a calculated attempt to exploit the disconnect between our recent share price performance and the inherent value of our unique and irreplaceable portfolio which is delivering record results.”
The proposal per share represents a significant discount of 20.7% to Hammerson’s European Public Real Estate net asset value per share of 776p as at 31 December 2017, Tyler said.
In response, Klépierre confirmed it made the proposal with the intention of engaging in a dialogue regarding a possible offer to acquire Hammerson on a standalone basis.
”The board of Hammerson rejected the proposal in less than 24 hours on 9 March 2018,” the listed French REIT said.
Klépierre’s proposal represented a 40.7% premium to Hammerson’s stock closing price of 437.10p on Friday.
Hammerson shares in London currently trade 24% higher at 543.80p.
Klépierre said the proposal does not constitute an offer, adding that there can be no certainty that any offer will be made.