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Capital & Counties Properties PLC and Shaftesbury PLC on Thursday said they have agreed the final terms of their all-share merger to create a central London-focused property investor with a combined portfolio value of £5.0 billion.
Shaftesbury shares fell 9.1% to 529.00 pence each following the announcement. Capital & Counties Properties shares were 1.8% lower at 149.00 pence each.
Shaftesbury shareholders will receive 3.356 new Capco shares for each Shaftesbury share held, giving Shaftesbury shareholders a 53% stake in the combined company and Capco shareholders 47%.
The pair had first confirmed they were in merger talks back in May, and those percentages haven't changed. Capco itself already holds a 25% stake in Shaftesbury.
The combined company will be called Shaftesbury Capital PLC and will own property in the West End of London, including in Covent Garden, Carnaby Street and Chinatown. This is ‘close to its major cultural and entertainment attractions, employment locations and transport hubs,’ the companies said.
The combined group will have EPRA net tangible assets of about £3.8 billion and an EPRA net tangible asset per share of around 207 pence as at March 31, Capital said.
‘The combined group will provide a rare opportunity in the listed real estate sector to invest in an exceptional mixed-use portfolio in the heart of central London,’ said Capital. Both firms are London-based real estate investment companies.
‘Special resolutions to amend the articles of association of Shaftesbury in connection with the implementation of the scheme...must be passed at the Shaftesbury general meeting, requiring the approval of Shaftesbury shareholders representing at least 75% of the votes cast,’ added Capital. The merger also requires the approval of Capital shareholders.
‘Capco and Shaftesbury are both committed to delivering positive environmental and social outcomes through long-term responsible stewardship, sustainable use of heritage and period properties, and engagement with residents and other local stakeholders,’ Capital added. The new group aims for net zero carbon by 2030, it touted.
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