Singaporean property development company City Developments Limited (CDL), Agapier Investments Limited (Bidco) – an indirect wholly owned subsidiary of CDL – and Millennium and Copthorne Hotels (M&C) have reached an agreement on $986.8m final cash offer for the hotel group.
Currently, CDL owns approximately 65.2% of M&C and made an offer of 685 pence per share for the remaining equity.
The company previously made an offer for M&C in December 2017 but it fell through in January 2018 as it didn’t meet the condition of more than 50% of the hotel group’s shares that it did not already own.
M&C’s independent directors, who have been advised by Credit Suisse, consider the terms to be “fair and reasonable” and intend unanimously to recommend that its shareholders accept the final offer.
The offer values the UK-listed hotel group at £2.23bn ($2.84bn) The maximum cash consideration payable by CDL amounts to £776.29m ($986.8m) which will be funded through a combination of internal cash resources as well as funds made available to CDL under a credit facility.
Sherman Kwek, CDL’s group chief executive officer, said: “Taking M&C private is in line with CDL’s strong focus on boosting recurring income and enhancing underperforming assets. We are pleased to have garnered the support of M&C’s independent directors and key minority shareholders. The offer enables shareholders to exit an illiquid stock at a significant premium.
“We believe that a privatised M&C will be in the best position to navigate the increasingly challenging and competitive global hospitality landscape with agility and nimbleness. M&C will be able to leverage CDL’s significant resources, comprehensive real estate capabilities and global network to reposition its assets and drive sustainable hotel performance.”
M&C has 120 hotels in 79 locations in Asia, Australasia, Europe, the Middle East and North America.