US private equity firm Lone Star raised its offer for Quintain Estate and Development to about £745 million (€1 billion) yesterday after comments from an activist shareholder threatened to demolish its takeover plans.
The revised offer of 141 pence per share, 10 pence higher than its previous bid, helped Lone Star win enough shareholder support to declare the offer unconditional. The offer, which gives Lone Star access to one of London’s few remaining large-scale development opportunities, represents a premium of about 31.8 per cent to Quintain’s closing price on July 28th, the day before the first offer was announced.
Quintain’s shares rose more than 7 per cent to touch the offer price. The stock was trading at 140.75 pence on the London Stock Exchange at 11.26am. The company’s shares have been trading at a discount to its net asset value – the market value of its portfolio – due to the risk associated with holding large land assets without permission to build.
Lone Star’s new offer comes two days after activist shareholder Elliott Capital Advisors said the original offer substantially undervalued Quintain and that it had not accepted the offer.
