Qatari Canary Wharf bid rejected

A bid to take ownership of Canary Wharf has been rejected by the current operator.

Songbird Estates announced that it had turned down an offer from the Qatar Investment Authority (QIA) and US investor Brookfield Property Partners. A statement released by Canary Wharf's owner confirmed that it had rejected the advances of the two bidders, saying that the proposal "materially undervalues Songbird".

QIA and Brookfield have put forward an offer of 295p a share which was flatly rejected by Songbird. The two companies already have an interest in the development with QIA owning 28.6 per cent of Songbird, while Brookfield boasts a 22 per cent stake in Canary Wharf Group. Songbird's decision to reject prompted a boost in shares, soaring by 22 per cent to close at 320p a share.

David Pritchard, the independent chairman of Songbird, said: "This proposal significantly undervalues Songbird and does not reflect the inherent value of the business and its underlying assets.

"The group has an exceptional management team with a clear vision to deliver additional shareholder value, including from our 11 million square foot development pipeline, the largest in London."

Canary Wharf has become the focal point of London's financial district. Some of the world's largest corporations such as HSBC and Citigroup are situated at Canary Wharf. The area also boasts one of the tallest buildings in Europe, One Canada Square, which houses companies such as The Bank of New York Mellon, the CFA Institute and MetLife.

Songbird's decision to reject the advances of QIA and Brookfield has not come as a surprise, according to James Carswell, real estate analyst at Peel Hunt. Speaking to the BBC, the expert explained that there is a "real possibility" that the two companies will return with another bid, but stated that it needs to be in the region of 350p a share to be considered.

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