Decision day in Canary bid battle

THE 15-month bid battle for Canary Wharf comes to a head today with the board hoping that an army of hedge fund managers will help push through a £1.71bn takeover by a Morgan Stanley-led consortium.

However, concern is mounting that opposition to the 295p-a-share bid, led by major shareholder Brascan and Wharf founder Paul Reichmann, could yet scupper the deal, leaving the owner of the 83 acres of Docklands estate as a public company.

Songbird, the Morgan bid vehicle, lowered its acceptance threshold to 50% last month but, with about 43m new shares owed to Reichmann under warrants and options included in its offer, analysts say Songbird has at least a 54% threshold to beat.

A report from broker Seymour Pierce points out that Songbird's main lender, Royal Bank of Scotland, could still pull the plug if the offer goes through with too slim a majority.

A 22% bloc comprising CNA Financial and Songbird backers Simon Glick and Prince Alwaleed supports the bid. Hedge funds are thought to be ready to accept their combined 20% holding.

Opposition includes 9.5% holder Brascan, Reichmann with 16% including warrants, and a 12% trio of Hermes, Scottish Widows and yet-to-decide Franklin Mutual.