Simon told to "put up or shut up"

SIMON Property Group has been told to either submit a formal bid for The Trafford Centre’s suitor Capital Shopping Centres (CSC) by January 12 or abandon its bid.

The ‘put up or shut up’ deadline was imposed by the Takeover Panel following the US property giant’s indicative £3bn offer for CSC last week, which  was rejected by the board as it “very substantially” undervalued the company.

CSC was in the midst of its own £1.6bn takeover bid for Peel Group’s Trafford Centre which would lead to Peel founder John Whittaker owning a 19.9% stake in the company. The bid was opposed by Simon as it believed that it would dilute CSC’s value and suck cash out of the business. Simon Property Group currently owns 6.25% of CSC.

Reports state that representatives from Simon are due to meet CSC’s larger shareholders such as Blackrock and Legal & General this week in a bid to convince them of the merits of its bid. It has also been reported that Simon is considering the prospect of increasing its offer from 425p to 435p per share.

A precondition of Simon’s bid is that CSC does not conclude its takeover of the Trafford Centre.

Last week Peel said that it  had also been approached by Simon  with a bid, which it had rejected.

“Peel strongly believes in the future growth prospects of CSC as an independent UK company,” it said

“The enlarged group, enhanced by the inclusion of the Trafford Centre, will have a unique portfolio of super prime UK regional shopping centres.  This portfolio and the addition of Peel’s proven UK retail and leisure property expertise will drive significant incremental future growth for the benefit of all shareholders.”