Canary Wharf owner unveils biggest ever property rescue
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Going for more than a song: the majority owner of Canary Wharf has revealed the biggest-ever equity raising by a UK property company
The majority owner of Canary Wharf, Songbird Estates, revealed on Thursday the biggest-ever equity raising by a UK property company in order to pay off a loan that threatened to push the business into collapse.
The fund-raising is worth £1.03bn overall, with a £620m placing and compensatory open offer, a £275m issue of preference shares and a £135m loan from leading shareholders.
Canary Wharf will now begin a new era with Qatar, China and American entrepreneur Simon Glick set to hold stakes in excess of 20pc in Songbird after providing significant support for the fund-raising.
Paul Reichmann, the founder of Canary Wharf, has effectively seen his involvement in the estate ended after his 8.45pc stake was taken by Commerzbank and sold for £112.5m to Songbird.
Investors owning the listed B shares in Songbird face a 99pc dilution in their holdings if they do not take up their rights. They can subscribe to the £190m compensatory offer, which is priced at 1p per share, a 97pc discount to the previous closing share price. In response the shares fell 93pc to 2.4p.
