£890m Chelsfield pitch by Bernerd

ELLIOTT Bernerd, executive chairman of Chelsfield, is expected shortly to make a fresh approach to take the property group private, with a proposal pitched at about 315p per share.

The renewed approach early in the New Year, which will value the group at about £890 million, will be the third attempt by Bernerd and his consortium to take the company private. His previous proposal of 305p a share was rejected this month by non-executive directors led by Sir Bruce MacPhail.

In a statement last week, the independent directors said that the earlier offer price 'may not fully reflect the long-term value of Chelsfield', but the statement confirmed that talks would continue 'with a view to securing a more attractive proposal'. It added that no significant bidders other than Bernerd's consortium had come forward.

Bernerd, 57, who owns 12% of Chelsfield, has been working on a takeover offer for the group for almost a year, claiming that the present share price does not reflect its true value. He founded the company in 1986 and floated it for about £200 million in 1993.

Shares in Chelsfield have been hovering around the 315p level since October, but slumped 111/ 4p to 3033/ 4p last week as markets interpreted the statement to mean that no deal was imminent.

It is believed that the independent directors' decision is complicated because of the concern that a sale at this time could give away huge future value in Chelsfield with the group's key developments at Paddington and White City still years from completion.

The development at Paddington will see the once-derelict canalside area near the London station turned into a residential and shopping complex.

Prices for apartments in the development are expected to start at £300,000.

Elsewhere in the property sector, shareholders in Canary Wharf will vote tomorrow on whether to sell off two sites in a deal crucial to the future of the group.

A consortium led by investment bank Morgan Stanley has offered 265p a share for the group, but the bid will go ahead only if the two sites in Canada Square are sold off.

The consortium is opposed by key shareholders in the group, including the Canadian property concern Brascan and Paul Reichmann, the founder of Canary Wharf. Both are planning their own bids for the business.

Investors opposed to the Morgan Stanley-led bid, including Brascan, are expected to vote against the property sales at tomorrow's meeting to stop the bid in its tracks.

Reichmann and Brascan have also hatched a complex deal under which they will support each other against the Morgan Stanley bid, but may later make their own independent offers. The terms of the deal mean Reichmann may make an offer at least 275p a share before the end of January, but if he does not, Brascan will enter the race with an offer of at least 267p. But there is no guarantee either will make an offer.

Shares in Canary Wharf ended last week at 266p, valuing the group at £1.56 billion.