Hammerson’s board has unanimously rejected a £5bn takeover bid from European retail developer Klépierre, calling its offer “wholly inadequate” and “entirely opportunistic”.
In a note to the stock market this morning, Hammerson confirmed it had received an offer from Klépierre but stated that the proposal significantly undervalued the company.
Hammerson chairman David Tyler delivered a stinging rebuff to Klépierre’s bid, saying the board saw “absolutely no merit” in the proposal.
He said: “Klépierre is asking our shareholders to accept a price for their Hammerson shares which is not only at a significant discount to their book value but includes a large element of paper in a company which, in our view, has a lower quality portfolio and lower growth prospects.”
Klepierre is Europe’s second biggest shopping centre operator and owns more than 100 malls across the continent.
The offer from Klépierre proposed a price of 615p per Hammerson share, paid 50 per cent in cash and 50 per cent in Klépierre shares.
Hammerson said Klépierre’s price undervalued the company by more than 20 per cent, and did not take into account Hammerson’s growth prospects in Ireland and France.
The Hammerson board also said it believed Klépierre’s property portfolio to be of a materially lower quality, and there was “limited commercial rationale behind the proposal”.
The note from Hammerson came after The Times reported the £5bn offer could threaten Hammerson’s proposed acquisition of fellow UK-based retail developer Intu.
In December it was revealed that Intu had accepted a £3.4bn takeover bid from Hammerson, a deal that would put Hammerson in control of a retail and leisure property portfolio worth £21bn.
In the trading note this morning, Hammerson said the Intu acquisition would bring together two high-quality portfolios under its management team and make the company the market leader in the UK, owning 19 of the UK’s 30 major shopping centres.
Klépierre confirmed that on 8 March 2018 it had made a proposal on a ”non-adversarial basis” to the board of Hammerson. The company said: “It was with the intention of engaging in a constructive dialogue regarding a possible offer to acquire the issued and to be issued share capital of Hammerson on a standalone basis at a value of 615 pence per Hammerson ordinary share”
Hammerson is currently developing a number of shopping centre projects across the UK, including the £1.4bn redevelopment of Brent Cross in north London being carried out by Laing O’Rourke (pictured).