May 11, 2018 / 4:35 PM / 2 months ago

Britain's IWG receives takeover approaches from three suitors

LONDON (Reuters) - British serviced office provider IWG (IWG.L) has attracted takeover approaches from three rival suitors, potentially plunging the $3.1 billion company into a bidding war.

The London-listed business said on Friday that U.S. property investment firm Starwood Capital and British private equity house TDR Capital had submitted two separate indicative cash bids.

Lone Star, the U.S. buyout firm, has also made an approach, IWG said, without giving details of any of the proposals.

The company disclosed its suitors’ advances after its shares leapt by 10.3 percent to close at 252 pence amid stock market speculation it had become a takeover target. That gives IWG a market capitalization of about 2.3 billion pounds ($3.1 billion), Thomson Reuters data shows.

The approach from Lone Star is at a more tentative stage than the proposals from Starwood and TDR, a person familiar with the matter said.

It marks the second time in less than five months that IWG has found itself on the receiving end of a bid.

In December, the company disclosed that Canadian private equity firm Onex and Brookfield Asset Management had made a joint approach, only for takeover talks to collapse at the beginning of February.

IWG has offices in about 3,000 locations in 114 countries around the world, operating under a range of brands including Regus and Spaces.

Revenues rose 5.3 percent to almost 2.4 billion pounds last year, although pre-tax profits slid 14 percent to 149.4 million pounds during the same period.

The approaches for IWG come as Britain is gripped by a wave of mergers and acquisitions activity as companies take advantage of cheap debt financing to strike deals.

The value of takeovers involving UK companies reached its highest level since 2007 in the first quarter, according to Thomson Reuters data.

The stream of deals has included Takeda Pharmaceutical’s (4502.T) 45.3 billion-pound offer to buy drugmaker Shire (SHP.L) and Melrose’s (MRON.L) 8 billion-pound hostile takeover of engineer GKN GKN.L.

($1 = 0.7383 pounds)

Reporting by Ben Martin; Editing by Elaine Hardcastle and Jane Merriman

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