Simon walks away from CSC bid
Simon Property Group has walked away from a bid for Capital Shopping Centres. The UK shopping mall group had refused to allow it to conduct due diligence on its books, which Simon had made a precondition of any formal offer.
Simon, which has a stake of around 5.1% in CSC, reiterated that it was opposed to CSC’s recent agreement to buy the Trafford Centre in Manchester from Peel Holdings in a £1.6bn deal that would see Peel ending up with nearly 25% of CSC. Simon plans to vote against the proposed deal at the EGM to be held later this month, saying that the purchase price is too high and the transaction is still “deeply unattractive” despite its recently revised terms. Markets are now waiting to see whether Simon will reduce its holding in CSC or remain a shareholder for the longer term.
CSC defended the Trafford Centre deal in a statement to the London Stock Exchange, saying it was a very rare opportunity to acquire the whole of a pre-eminent UK out-of-town regional shopping centre and that the deal was expected to strengthen its position as the leading operator of pre-eminent regional malls in the UK. After the deal, CSC would own 14 UK shopping centres, including ten of the top 25 and four of the top six out-of-town centres.
