Simon set to sign £3bn loan to fund Capital Shopping Centres takeover

Marion Dakers
ALL EYES will be on US real estate firm Simon Property this week as it signs loan agreements to fund a formal bid for UK mall owner Capital Shopping Centres worth around £3bn.

Simon has until 12 January to formalise its 425p per share offer for the FTSE 100-listed firm after the City”s Takeover Panel issued a “put up or shut up” notice last month.

America’s biggest retail property group Simon said last week it had agreed terms for a loan of around £3bn with Citigroup, Deutsche Bank, Goldman Sachs and Morgan Stanley.

The loan facility announced would more than cover a bid at 425p per share, excluding Simon’s existing 5.1 per cent stake, though the exact terms of the loan are not finalised.

Analysts have previously voiced concerns that a bid at the current price would not be enough to persuade CSC investors to sell their stakes.

Simon first approached Capital in November, in an attempt to frustrate the firm’s £1.6bn deal to buy the Trafford Centre near Manchester.

Simon has said it will not make a deal unless the Trafford purchase from Peel Holdings is scrapped, and it has access to CSC’s books to undertake due diligence. Capital has so far rejected Simon’s requests.

Capital is due to hold a shareholder meeting on 26 January to approve the takeover of the Trafford Centre, after delaying the vote in the wake of Simon’s advances.