Published: Mon, March 19, 2018
Money | By Armando Alvarado

France's Klepierre confirms Hammerson approach was rejected in "less than 24 hours"

France's Klepierre confirms Hammerson approach was rejected in

Bankers at Goldman Sachs and Citigroup have advised a French shopping centre investor on an approach to United Kingdom developer Hammerson that could disrupt a tie-up deal it has already struck with another player.

It offered 615p per share - a premium of around 40.7 per cent to Hammerson's closing price on 16 March.

Hammerson said it had rejected the approach, which it described as "unsolicited and entirely opportunistic in its timing".

Shares in Hammerson were up 24% in afternoon trading, while Klépierre was down nearly 4%.

"The fixed nature of the Hammerson/Intu merger ratio (0.475 Hammerson shares for every one Intu share), makes the initial Intu share price reaction harder to call".

Shares in Klépierre were down 3.02pc on Monday morning to €33.71.

Hammerson has rejected the proposal, which was meant to be settled in cash and shares. "It is a calculated attempt to exploit the disconnect between our recent share price performance and the inherent value of our unique and irreplaceable portfolio which is delivering record results", said Hammersn Chairman David Tyler.

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The board of Hammerson said it "strongly advises" shareholders to take no action. The French company said the proposal was made on March 8 and that it was rejected by the Hammerson board in less than 24 hours.

The French firm said it made the proposal "on a non-adversarial basis" and "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".

In its statement, Hammerson argued that Klepierre's property portfolio was lower quality than its own.

The move comes after Hammerson agreed an all-share takeover of rival Intu in December a year ago, which will create Britain's biggest property company.

Hammerson shares have fallen amid investor worries that the Intu deal raised its exposure to a hard United Kingdom retail market and diluted its higher quality portfolio.

In a statement to the London Stock Exchange, Klepierre said there was no guarantee that a firm offer would be made.

"I'm guessing Klepierre's shareholders fear the company will be back with an improved (more expensive) price in a very hard market (commercial real estate) and they don't want to hear about a bidding war", said a Paris-based trader.

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