(Alliance News) - St Modwen Properties PLC on Thursday said it has accepted a firm 542 pence-per-share takeover offer from Blackstone Group Inc, worth a total of GBP1.24 billion.
Blackstone had announced on May 7 a possible offer of 542p per share, which Birmingham-based property investor St Modwen said it was minded to accept if made firm. It is a 21% premium over St Modwen's closing price of 448p on May 6.
Blackstone expects to complete the deal in July through a scheme of arrangement.
But it could face a battle to convince St Modwen shareholders to back the deal. JO Hambro Capital Management Ltd, which owns 9% of the company, said the offer is too low, Bloomberg reported. Peel Hunt called the offer "fair" but "by no means a knockout" in a note when the possible offer was first announced.
Shares in St Modwen were trading above the offer price on Thursday morning in London, up 1.9% to 544.00p.
The company said it is "well positioned to succeed as an independent business" but concluded that the Blackstone offer will significantly accelerate value creation.
The private equity firm said it will provide St Modwen with scale and capital to realise its potential.
Holders of 6.6% of shares have given irrevocable undertakings to vote in favour of the deal.
By Ivan Edwards; ivanedwards@alliancenews.com
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