Morgan tipped to win Wharf battle

A MORGAN Stanley-led £1.71bn bid for Canary Wharf was being tipped to beat Canadian rival Brascan in the battle for the 86-acre site as the auction moved into its final day.

Sources did not rule out Morgan changing its bid structure at the last moment to a simple offer needing 50% shareholder approval to squeeze past a potential dealblocking shareholder alliance of Brascan and Canary founder Paul Reichmann, who together own 18%.

Any final revisions to the offers were due in by 5pm today, leaving both bidders the option of last-minute increases.

Brascan's latest pitch is at 275p a share or nearly £1.61bn and needs only majority shareholder approval. The two competing bids must then remain unchanged for shareholders to decide, with completion about a month away.

It is almost 14 months since the tussle for Canary began with Brascan amassing a 9% stake at an average of 150p a share.

Morgan, backed by British Land and 14% shareholder Simon Glick, this week lifted its offer by 1/2p to 292 1/2p. The bid needs three times as many shareholder votes in favour as against to win.

Changing to a simple offer would allow Morgan to take control but leave Reichmann and Brascan as minority shareholders. Brascan has a paper profit of £75m from its Canary investment, worth 20% more in dollar terms than when it bought.