Login to UKBP
Commercial Property News
Minerva posts a £270million loss but shares rise as takeover talks near completion.
Minerva, the London commercial property developer, reported a financial loss of £270million reflecting the sharp drop in the value of its property portfolio. Net asset value per share fell 43% to 187.7p.
The group, which is exposed to City building schemes that could be hit by fall-out from the banking crisis, turned a pre-tax profit last year of £16.3million into a £269.2million deficit after taking £256million of land value write-downs to reflect the problems in the property sector.
Minerva shares have almost halved over the past two weeks on speculation that Limitless World, part of a Dubai sovereign wealth fund, was going to drop out of merger talks.
Minerva gave fresh hope of a deal when it said negotiations were continuing.
"Discussions with Limitless World are ongoing but there can be no certainty that an offer will be forthcoming. A further announcement will be made when appropriate," said a statement from Minerva, with the annual financial results.
Minerva is involved in the Walbrook and St Botolph's property developments in the City where the value of offices have dropped by nearly a third after record highs in the summer of 2007.
Salmaan Hasan, chief executive of Minerva, said the company had a bright future and that its balance sheet was in good shape. "Despite the challenging market conditions, Minerva remains well positioned. We have a robust balance sheet, funding in place for key developments and a strong cash position to move the business forward."
Minerva denied it was too closely linked to City developments at a time when banking and other investment firms faced a tough future. "We also have a very high quality and diverse development portfolio, comprising City of London offices, high end London residential, mixed use and town centre shopping," said chairman Oliver Whitehead.
The company said in July that it had received a proposal from Limitless to purchase the entire share capital of Minerva for 160p a share. Since then it has been engaged in due diligence of the accounts but some observers believed it was changing its mind on a £258million takeover deal. But its shares rose 20% to 85p yesterday as it raised hopes of a takeover by saying Limitless had completed due diligence but that there needed to be consent from third parties thought to be Minerva's banks.
The group, which is exposed to City building schemes that could be hit by fall-out from the banking crisis, turned a pre-tax profit last year of £16.3million into a £269.2million deficit after taking £256million of land value write-downs to reflect the problems in the property sector.
Minerva shares have almost halved over the past two weeks on speculation that Limitless World, part of a Dubai sovereign wealth fund, was going to drop out of merger talks.
Minerva gave fresh hope of a deal when it said negotiations were continuing.
"Discussions with Limitless World are ongoing but there can be no certainty that an offer will be forthcoming. A further announcement will be made when appropriate," said a statement from Minerva, with the annual financial results.
Minerva is involved in the Walbrook and St Botolph's property developments in the City where the value of offices have dropped by nearly a third after record highs in the summer of 2007.
Salmaan Hasan, chief executive of Minerva, said the company had a bright future and that its balance sheet was in good shape. "Despite the challenging market conditions, Minerva remains well positioned. We have a robust balance sheet, funding in place for key developments and a strong cash position to move the business forward."
Minerva denied it was too closely linked to City developments at a time when banking and other investment firms faced a tough future. "We also have a very high quality and diverse development portfolio, comprising City of London offices, high end London residential, mixed use and town centre shopping," said chairman Oliver Whitehead.
The company said in July that it had received a proposal from Limitless to purchase the entire share capital of Minerva for 160p a share. Since then it has been engaged in due diligence of the accounts but some observers believed it was changing its mind on a £258million takeover deal. But its shares rose 20% to 85p yesterday as it raised hopes of a takeover by saying Limitless had completed due diligence but that there needed to be consent from third parties thought to be Minerva's banks.
Fri, 19th Sep 2008