25th Sep 2015 08:31
LONDON (Alliance News) - US private equity house Lone Star on Friday increased its takeover offer for Quintain Estates & Development PLC, the North London-focused property developer, days after it was revealed that hedge fund Elliott Capital Advisors had built up a stake in Quintain and was opposing Lone Star's offer.
Quintain, which owns a large portion of land around Wembley Stadium in North London, accepted a GBP700.0 million takeover bid from Lone Star at the end of July. Since then, the bid deadline has been extended twice as Lone Star worked to secure the 75% of acceptances it needed to push the deal through.
On Thursday, The Times newspaper reported that Elliott, an aggressive activist hedge fund which also has been waging a battle with the board of Alliance Trust PLC, the FTSE 250 investment fund, had built up a stake of around 13% in Quintain via a contracts-for-difference arrangement and that it was planning to oppose Lone Star's offer, claiming it "substantially undervalues" Quintain.
The build up of the holding was confirmed in a stock exchange filing by Quintain on Thursday, when it said Elliott now holds a 12.9% stake in the business.
On Friday, Lone Star said it will raise the bid for Quintain to 141 pence per share in cash, valuing the company at around GBP745.0 million. The offer is at a 32% premium to Quintain's closing share price on July 28, the day before the offer was originally made, rather than the 22% premium the first bid was made at.
Shares in Quintain were up 6.9% on the news to 140.62 pence, one of the best performers in the FTSE All-Share.
By Sam Unsted; [email protected]; @SamUAtAlliance
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