Multimillionaire property developer Nick Candy is considering a takeover bid for Capital & Counties (Capco), the FTSE-250 real estate company that owns much of Earl’s Court and Covent Garden in London.
Candy, 46, who developed the luxury One Hyde Park residential and retail complex in Knightsbridge with his brother, Christian, said his investment vehicle Candy Ventures was in “the early stages of considering” buying all of the shares of 85-year-old Capco.
Shares in Capco, which had almost halved from their 2015 peak owing to delays in developing a massive complex of luxury homes on the site of the former Earls Court exhibition centre, jumped 8% to 269p on the news of Candy’s interest on Monday. At that price, Capco is valued at about £2.3bn.
The value of the Earls Court project, which has planning permission for 3.4m sq ft of homes and commercial space, has been repeatedly written down, because of the collapse in demand for luxury new-build homes and a bitter battle with Hammersmith and Fulham council over a lack of affordable housing. It is now valued at less than half the £800m price tag it had in 2015.
In the summer, Capco announced it would split the two parts of the business into separate companies in a bid to ringfence the Earls Court problems.
Capco said it noted Candy’s interest, but added: “At this stage there has been no approach made to the company by Candy Ventures or any other party.”
At the same time, Capco said it had entered into exclusive talks with investment firm Delancey regarding a possible sale of its Earl’s Court land. Delancey is the developer behind East Village, the former athletes’ village at the Olympic Park, which is now a vast private rental estate.
The board of Capco said the company was “well advanced” in its plans to separate its Earl’s Court and Covent Garden assets. “The board has full confidence in the company’s strategy and management to continue to deliver significant shareholder value,” Capco said.
Under the Takeover Panel’s “put up or shut up” rules, Candy Ventures must either state an intention to make an offer or back away from any deal by 18 November.
James Carswell, an analyst at Peel Hunt, said: “Such an approach is as much an endorsement of Covent Garden as it is an opportunistic tilt at Earl’s Court.”
Covent Garden is a thriving retail and restaurant district in central London and Capco’s portfolio covers 79 buildings and more than 1m sq ft.
At Earl’s Court, the aim is to build a vast new residential, retail and office district based on a masterplan of “four new urban villages and a high street” devised by architect Sir Terry Farrell. The plan includes 7,500 new homes and 3 hectares (7.5 acres) of public green space.
Capco said last month there had been progress with parties interested in buying its Earl’s Court assets and its board was working with selected parties for a possible sale.
Last year, Capco was in talks to sell the bulk of its interests in the Earl’s Court estate to Hong Kong billionaire property developer Li Ka-shing’s CK Asset Holdings.