Globalworth shareholders' $1.88 billion bid talk boosts shares

(Reuters) -Globalworth Real Estate’s top shareholders are planning an unsolicited bid valuing the British firm at 1.57 billion euros ($1.88 billion), CPI Property said on Wednesday, sending the shares sharply higher.

CPI and Aroundtown own 51.5% of Globalworth, which operates mainly in the office sector in Poland and Romania.

The proposed bid would offer 7 euros per share in cash, CPI said, a premium of nearly 20% to Globalworth’s last close but news of the move sent the stock up 28% to 7.50 euros on Wednesday.

Globalworth “strongly advised” shareholders not to take any action in relation to the offer as it evaluates it, the firm said in a statement.

“No proposal or details as to the terms of any offer were received by the company before this morning’s announcement,” it said.

CPI and Aroundtown said they would bolster Globalworth’s presence through increased investment in existing assets and by expanding its portfolio.

“Aroundtown believes that Globalworth has a very strong property portfolio, and we are excited to expand our footprint in the CEE region through this partnership with CPI,” Aroundtown finance chief Eyal Ben David said.

The office real estate sector is currently struggling due to restrictions caused by the pandemic and uncertainty about the speed of reopening and the return-to-work plans.

That has also meant a fall in share prices, making players in the office space more attractive.

Globalworth shares listed on the junior market of the London Stock Exchange are down about 17% this year after slumping 23% in 2020.

CPI’s portfolio consists of office properties, retail, residential as well as hotels and resorts, while Aroundtown invests mainly in commercial and residential real estate.

($1 = 0.8354 euros)

Reporting by Yadarisa Shabong and Aby Jose Koilparambil in Bengaluru; editing by Shounak Dasgupta and Jason Neely