The Investment Corporation of Dubai has been granted an extension on its period of bid exclusivity with the key shareholders of debt-strapped Spanish property giant Colonial until 27 February. In a statement, the sovereign wealth fund said it asked for the extension to continue both due diligence and negotiations with Colonial's creditor banks. Colonial shareholders Luis Manuel Portillo, who owns nearly 40% of the company and resigned at end-2007 as chairman, and Juan Carlos Nozaleda, who holds 12.3%, have already agreed to accept an offer from ICD should it materialise. Should ICD purchase their stakes, it would be obliged to make a public offer for outstanding shares.
The Investment Corporation of Dubai has been granted an extension on its period of bid exclusivity with the key shareholders of debt-strapped Spanish property giant Colonial until 27 February. In a statement, the sovereign wealth fund said it asked for the extension to continue both due diligence and negotiations with Colonial's creditor banks. Colonial shareholders Luis Manuel Portillo, who owns nearly 40% of the company and resigned at end-2007 as chairman, and Juan Carlos Nozaleda, who holds 12.3%, have already agreed to accept an offer from ICD should it materialise. Should ICD purchase their stakes, it would be obliged to make a public offer for outstanding shares.
However, new agency Reuters reported that since Colonial has already breached loan covenants, creditors could potentially gain control of the company, avoiding a sale to a third party and instead selling Colonial’s assets.
Colonial is one of the largest real estate companies in Spain and has a property portfolio covering offices, retail and residential units valued at more than EUR 12 bn. In recent months the company has sold off some office assets to help reduce its debt. Talks with GE real Estate and French property group Gecina on a possible merger late last year did not result in a deal.
