Fortress drops Mapeley take-private bid

US private equity firm Fortress Investment Group has ended talks with UK property outsourcing company Mapeley after weeks of talks.

Fortress Investment Group, the majority shareholder of UK property company Mapeley, has terminated talks to take private the UK property outsourcing company with a portfolio of approximately £2.2 billion (€2.7 billion; $4.3 billion).

Mapeley announced on 26 February that, following an approach, it was in discussions relating to a possible offer for the company, though it did not name the interested party.

However, in a statement today, Mapeley said: “These discussions have now ceased. Since receiving the approach, Mapeley has announced its 2007 results which included details of the successful refinancing of the company's £257 million revolving Delta acquisition facility.”

Jamie Hopkins, chief executive added: “Our robust business model and the resilience of our income streams position us well to continue to deliver consistent returns.”

The Financial Times reported Fortress was behind the bid last month, suggesting it was a sign of things to come for listed property managers. With the share prices of many UK property companies having taken a battering in recent times, investors are seeing value in them.

Fortress was one of the original backers of Mapeley in 1999 and helped bring the company to the public market. It owns more than 50 percent of the company. The offer it made was thought to be £19 a share, valuing Mapeley at around £560 million.

 In a conference call after Fortress’s fourth-quarter results earlier this week, chief executive Wes Edens said: “We evaluate out companies all the time, but at the current time we have no plans to take any of the companies private.”

“The companies may be depressed in terms of their value in the public markets, but in many cases still represent substantial gains over their cost bases, because we’ve held a lot of these investments for a long time and had a lot of success with them.”