Brascan matches Morgan's offer

MORGAN Stanley's aim of taking Canary Wharf private without the hostile presence of founder Paul Reichmann looks increasingly difficult.

The property tycoon and Brascan of Canada have secured the support of major CW shareholder Franklin Mutual.

Together the three parties have enough shares to vote out Morgan Stanley's £1.6bn takeover bid which - structured as a scheme of arrangement - needs 75% acceptances.

Brascan played its ace by raising its bid 5p to 275p a share, matching Morgan Stanley's offer and putting it in a strong position. Even if Morgan Stanley opts for a straightforward takeover plan and wins the necessary 50% approval, Reichmann and Brascan do not have to sell their minority stakes.

The Brascan camp said: 'Morgan Stanley will be stuck with a very large hostile minority.'

Franklin has promised to back Brascan unless a 292p-a-share cash offer materialises - a hefty £100m more.

Morgan Stanley was last night considering its next move. CW shares fell 2 1/2p to 276p.