Capital Shopping Centres has responded to Wednesday’s highly indicative 425p per share cash offer from Simon Property Group with a resounding no – and asked the Takeover Panel to make the US mall operator Put Up or Shut Up.
Highlights from a CSC press release:
The Board of CSC believes that this is yet another attempt by Simon to frustrate the Trafford Centre acquisition without putting forward a proper proposal for CSC shareholders to consider as an alternative, and accordingly unanimously rejects the Proposal. Notwithstanding this, the Board has concluded that it is appropriate to adjourn the EGM to endeavour to ensure that CSC’s shareholders are provided with the necessary information about the Proposal to make a clear decision.
CSC also rejects Simon’s assertions that it has failed to enter into any dialogue with Simon. The Board has received a series of contradictory letters and proposals since 24 November 2010 from Simon which have been released by Simon to the media immediately and before CSC has been able to discuss them.
As a result, the Board’s advisers have today initiated a discussion with the Takeover Panel to establish a latest date and time by which Simon must make a formal offer under Rule 2.5 of the Code or confirm that it does not intend to make an offer.
Given the contradictory letters from SPG, it seems likely the Panel will look favourably on CSC request for a Put Up/Shut Up.
However, SPG has forced CSC to adjorn the shareholder vote on Trafford Centre acquisition until the new year, which gives it time to convince wavering shareholders that it’s not a good deal.
As a reminder, if CSC goes ahead with the £1.6bn purchase, John Whittaker, the billionaire businessman, will emerge with a 19.9 per cent stake in the company.
The Trafford deal now seems increasingly unlikely to happen, but so does a formal bid for CSC. The company and its South African shareholders are likely to want at least 440p a share, and it’s doubtful SPG is prepared to pay that much.
That said, the price action in CSC shares this afternoon suggests that the market is betting on a higher bid from SPG that will be recommended by the board:
But it’s a brave punter that buys in at these levels.
And to finish, another amusing picture of John Whittaker:
And another:
Related links:
Simon says, we’ll bid for Capital Shopping Centres… – FT Alphaville
Simon says… how about this for a screeching U-turn? - FT Alphaville
Simon says… the game is up – FT Alphaville
Simon Property Group goes shopping – FT Alphaville