Key facts
- Peel Group has offered £583 million for property developer Harworth.
- The offer price of 172.5p per share includes a 20.1% premium over Harworth's closing price and a 36.9% premium over the past month's average.
- Peel Group, already a significant shareholder, cited concerns about Harworth's cash flow sustainability and development strategy.
- Harworth recently revealed plans to develop a hyperscale data centre, with advanced negotiations underway for its sale.
- The data centre site sale is anticipated to be more valuable than a previous £107 million land sale to Microsoft.
Peel Group, a company majority-owned by Manchester billionaire John Whittaker, has submitted a £583 million offer to acquire the property developer Harworth Group. The offer, priced at 172.5p per share, represents a significant premium of 20.1% above Harworth's closing share price on the previous day and a 36.9% premium compared to its average share price over the last month.
Peel Group, which already holds approximately 30% of Harworth's shares, stated that the company's current listing on the London Stock Exchange provides limited benefits due to its concentrated shareholder register, which impacts share liquidity and growth potential. The three largest shareholders collectively own over 75% of the business.
Furthermore, Peel Group expressed concerns regarding Harworth's financial sustainability, noting that its "cash flow profile is increasingly becoming less sustainable" and that its "direct development and hold strategy to be capital-intensive, slow to deliver value and increasingly unable to generate appropriate risk-adjusted returns."
This potential takeover follows a recent surge in Harworth's share price, which increased by more than 10% this week after the company announced plans to develop a new hyperscale data centre. Harworth has indicated it is in advanced negotiations with multiple parties for the sale of this site, having already secured planning permission. The company anticipates this transaction will be more valuable than a previous land sale to Microsoft in 2024, which generated £107 million. Harworth's Chief Executive Lynda Shillaw emphasized the company's role in the expansion of the UK's digital infrastructure.