Shaftesbury chief retires on massive property merger at Capco London

London mega property merger talks confirmed: Shaftesbury chief will retire after 36 years if £3.5 billion Capital & Counties partnership is completed

  • Shaftesbury CEO Brian Bickell joined in 1986, the same year it was founded
  • CEOs Simon Cowell and Tom Welton will also leave the company
  • Shaftesbury confirmed that it is in merger talks with Capital and Counties Real Estate

Leaving: Brian Bickell joined Shaftesbury in 1986, the same year the Levy . family was founded

Shaftesbury, the West End owner, said his long-serving boss will step down once a potential merger with Capital & Counties Properties is complete.

The two London commercial property giants confirmed they were in talks about a massive £3.5 billion merger this morning.

The newly expanded company will have 2.9 million square feet of space covering much of the prime central London area, from Fitzrovia to the popular shopping and tourist site Covent Garden and entertainment district Soho.

Brian Bickle joined Shaftesbury REIT in 1986, the same year the Levy family founded it, before becoming its chief financial officer a year later and ascending to CEO in 2011.

CEOs Simon Cowell and Tom Welton are leaving the company, a prominent property owner in London’s Chinatown, after working there for more than three decades.

Their departure will occur once Shaftesbury’s potential relationship with Capital & Counties Properties – known as Capco – which will create one of the world’s largest listed commercial real estate companies – is settled.

Under the currently proposed deal, Shaftesbury shareholders would own 53 percent of the business, while Capco investors would own the remaining 47 percent.

Shaftesbury Chairman Jonathan Nichols and Chief Financial Officer Chris Ward will become Chairman and Chief Operating Officer, respectively, while current Capco President Ian Hawksworth will serve as CEO.

Chiefs at Shaftesbury warned: “Discussions are ongoing and the full terms of a potential merger have not been finalised. There can be no certainty that an offer will be made.

Capco already owns 25.2 per cent of Shaftesbury after buying £436m of equity capital from Hong Kong billionaire Samuel Tak Lee two years ago.

That led to suggestions that it would launch a hostile takeover of the FTSE 250, which valued its property portfolio at around £3.8 billion just before the pandemic.

Ownership @ Shaftesbury is a major property owner in London's Chinatown district.  It also operates buildings in Fitzrovia, Covent Garden and the Soho Entertainment District

Ownership @ Shaftesbury is a major property owner in London’s Chinatown district. It also operates buildings in Fitzrovia, Covent Garden and the Soho Entertainment District

After two years of very difficult challenges due to reduced rent collections and exemptions, and increased vacancy rates, these properties are now worth around £3.3 billion.

Retail tenants renting out the group’s properties in central London have traditionally relied on international travelers and tourists for trade, yet harsh travel restrictions and the emergence of hybrid business have significantly reduced their numbers.

In addition, bars, restaurants and popular cultural attractions, such as theaters, museums and art galleries, have been forced to close or operate under severe capacity restrictions for most of 2020 and 2021 due to their “non-essential” status.

But with the relaxation of rules on travel and commerce, office workers and tourists are starting to return in droves, but not at levels that were before the outbreak of the pandemic.

Amid a broader slowdown in London markets, Shaftesbury shares fell 3 per cent to 559.5 pence in early trading, while Real Estate Capital & Counties shares fell 3.3 per cent to 1.60 pounds.

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