Capital & Counties buys shares in rival Shaftesbury

Capital & Counties spends £436m on shares in larger rival Shaftesbury – paving way for mega-merger of West End property giants

The owner of a huge estate in London’s Covent Garden has spent £436million on shares in larger rival Shaftesbury – paving the way for a mega-merger of West End property giants. 

Capital & Counties has struck a deal to pay Samuel Tak Lee, a Hong Kong-based tycoon who owns a large chunk of the West End, 540p a share for the 26.3 per cent stake. 

Investment opportunity: The move will fuel speculation Capital & Counties may launch a hostile takeover bid for Shaftesbury

Shaftesbury’s shares closed at 627p on Friday, meaning Capital & Counties secured a near 14 per cent discount. The move will fuel speculation Capital & Counties, which is worth £1.3billion, may launch a hostile takeover bid for Shaftesbury, worth £1.9billion. 

Capital & Counties’ £2.6billion Covent Garden estate covers shops, restaurants and offices. Shaftesbury has a £4billion portfolio that spans 15 acres of Chinatown, Carnaby, Soho, Covent Garden and Fitzrovia. 

It is not clear why reclusive billionaire Lee, 81, has jettisoned his stake after years building it up. He fell out with Shaftesbury in 2017, suing it for alleged losses following a £265million capital raise. 

The value of his investment has fallen about 25 per cent in the Covid lockdown.