Songbird Estates shareholder Madison International Holdings plans to accept a hostile takeover bid by Qatar Investment Authority and Brookfield Property Partners.
An offer of £3.50 per share was made for the Canary Wharf Group owners on Thursday, valuing the firm at £2.6bn.
The decision to go hostile followed Songbird’s rejection of an initial offer of £2.95 per share at the beginning of November, which the company said “materially undervalued” the business, and rejected the proposal.
In a statement to the City last week, Songbird also said the latest offer of £3.50 did “not reflect the full value of the company” but its shareholders have yet to vote on the proposal.
Songbird estimated the business should now be worth £2.8bn on a net asset value basis.
Madison holds a total of 18,627,054 Songbird shares, representing around 12 per cent of Songbird’s free float and around 2.5 per cent of Songbird’s issued ordinary share capital.
Taken together with the backing of fellow shareholder Third Avenue Management, QIA and Brookfield have so far received public support from holders of approximately 28 per cent of Songbird’s free float.
QIA already owns 28.6 per cent of Songbird and Brookfield has a 22 per cent stake in the Canary Wharf Group.
A QIA spokesperson had said the offer would simplify the ownership and governance structure of Songbird, as well as the Canary Wharf Group.
The spokesperson added: “The final offer price represents a significant premium to Songbird’s fundamental value and to the pre-approach share price, even following a significant increase in the reported valuation and the share price of Songbird over the last 12 months.
“The Songbird offer provides what we believe is a highly attractive opportunity for shareholders to exit an illiquid investment.”
Brookfield chief executive Ric Clark said: “As long-term investors in Canary Wharf, we are pleased to be in a position to make this compelling offer to the shareholders of Songbird.
“It provides shareholders with the opportunity to realise the very significant increase in value that Songbird has experienced over the last year. The offer is being made as Canary Wharf embarks on an ambitious development programme that will alter its risk profile.”