Property development firm Capital & Counties (Capco) today confirmed it is in discussions to snap up a 23.6 per cent stake in rival Shaftesbury.
The two firms own swathes of neighbouring property in the West End and the talks have sparked further speculation of a merger.
The discussions, first reported by React News, are centred on the sale of Samuel Tak Lee’s stake in Shaftesbury.
The Hong Kong property magnate, who for months has been locked in a dispute with the property firm over an equity fundraising, is said to be seeking £5 per share, valuing his stake at just over £400m.
Shares in Shaftesbury rose almost 2.5 per cent on the announcement, while Capco ticked up one per cent.
Rumours have long circulated about a potential tie-up between the rival London property giants.
Capco owns an estate in Covent Garden worth £2.6bn, while Shaftesbury’s £4bn portfolio spans Chinatown, Carnaby Street and Fitzrovia.
In a statement released last night Capco said there could be no certainty that the discussion would lead to an agreement.