Capital & Counties Properties has agreed to buy a 26.3% stake in London rival Shaftesbury from Hong Kong billionaire property magnate Samuel Tak Lee for £436 mln (€490 mln).
The investment reflects a price of 540 pence per Shaftesbury share representing a discount of 13.9% to the closing Shaftesbury share price on 29 May 2020.
The investment is consistent with Capco’s strategy to grow its central London property investment business, centred around the Covent Garden estate, the company said in a statement.
Commenting on the rationale for the deal, Capco said that while Covid-19 has had a significant impact on the group’s business in the near term, it has also provided an opportunity to acquire the shares in a unique central London portfolio at an attractive pricing.
‘Similar to Capco’s world-class estate at Covent Garden, Shaftesbury’s portfolio in the heart of London’s West End has been characterised by careful strategic assembly and creative asset management over time,’ the company said, adding that it continues to believe ‘in the resilience and long-term fundamentals of prime central London and in particular the West End’.
The price paid represents a 45.0% discount versus Shaftesbury’s last reported EPRA NAV per share of 982 pence as at 30 September 2019.
‘As long-term investors in the Covent Garden estate and the West End, the investment in Shaftesbury represents a unique opportunity to deploy our capital in an exceptional portfolio at an attractive entry price, which we believe will generate long-term value for Capco shareholders,’ commented Ian Hawksworth, Chief Executive of Capco.
Capco said the deal, which is expected to be completed in two tranches, would be fully funded through its shopping and entertainment estate Covent Garden’s revolving credit facility of £705 mln.
