Shares in Spain's largest property company Colonial soared by as much as 13% on Monday after the company's two main shareholders agreed to sell their interest to a Dubai sovereign wealth fund if it makes an offer. Colonial shares were up 9.7% at EUR 1.69 in Madrid trading in the early afternoon.
Shares in Spain's largest property company Colonial soared by as much as 13% on Monday after the company's two main shareholders agreed to sell their interest to a Dubai sovereign wealth fund if it makes an offer. Colonial shares were up 9.7% at EUR 1.69 in Madrid trading in the early afternoon.
In a statement to the Spanish stock market regulator CNMV, the Investment Corporation of Dubai (ICD) said that investors Juan Carlos Nozaleda and Luis Manual Portillo agreed at end-January to sell their combined 52% stake in Colonial. ICD added that it hoped to have access to Colonial's books soon to carry out two weeks of due diligence after signing a confidentiality agreement. After carrying out the due diligence on Colonial, ICD would then have three days to decide whether to make an offer for the troubled Spanish group.
Since December, the Spanish group has confirmed merger talks first with French property group Gecina, then with GE Real Estate, and most recently with ICD. On Friday, GE Real Estate Iberia, the property arm of General Electric in Spain, said it pulled out of the bidding for 'the time being', adding the move would not influence a possible decision to resume its offer in the future.
Colonial has been the focus of takeover speculation after its shares plunged 51% last month in the face of declining property values and banks' disinclination to lend in the current market crisis.
