12 October 2004 – By Morag MacKinnon Wall Street Journal
SYDNEY – Australia’s Westfield Group and Multiplex Group look more likely to succeed in a bid to acquire Chelsfield PLC after they joined forces in a proposal with the target’s majority shareholders, David and Simon Reuben.
The trio have made a £585 million (€844.6 million) bid for Duelguide PLC, the holding company of Chelsfield, valuing the U.K. property group at about £2.1 billion, including debt.
Westfield’s investment, including assumed debt, would be about A$2.9 billion (€1.72 billion) and provide the company with about A$4.4 billion of future developement opportunities, it said.
Multiplex which owns a 6% stake in Duelguide, declined to reveal how much it would invest. Company Secretary Mark Wilson said it will establish an equal joint-venture firm with Aldersgate, owned by David and Simon Reuben who hold 34% of Duelguide, for the proposal.
On Sept. 30, Westfield made its own £585 million cash proposal for Chelsfield. Westfield said it would persue its own proposal if the three-way bid doesn’t proceed. Meanwhile, Multiplex and Aldersgate reserve their right to pursue other proposals if the latest bid doesn’t go ahead.
Duelguide was formed to arrange a management buyout of Chelsfield, led by founder Elliot Bernerd, earlier this year. Mr, Bernerd is willing to sell his 11% stake to the three-way group.
Westfield of Sydney is the world’s largest owner of shopping malls. It owns and operates 124 shopping malls in the U.S., and the U.K., Australia and New Zealand, and has assets of A$36.5 billion. Multiplex, also based in Sydney, is a property business and construction company that is building Wembley Stadium in London.
David and Simon Reuben are billionaire property investors who own more than 100 buildings in the U.K.
By joining forces, the group has guarantees uit will be able to acquire some 64.3% of Duelguide, provided it launches a formal bid for Duelguide by Sunday. If the joint bid is successful, Duelguide’s assets will be split among the members of the bidding group.
Westfield will acquire full ownership of the Merry Hill shopping centre in Birmingham, valued at around £900 million, and a 25% interest in White City shopping centre, which will be the largest shopping centre in London whem it is completed in 2008.
Muliplex and the Reuben brothers will acquire a jointly held 50% stake in the White City shopping cente and an interest in the portfolio of six U.K. retail properties, comprising approximately two millions square feet.