Shares in the firm behind Docklands landlord Canary Wharf Group were on the up today after a refinancing deal which could pave the way for dividend payouts for its ordinary shareholders.
Songbird Estates, which owns 69% of Canary Wharf, struck the deal with the Qatari and Chinese holders of £275 million in preference shares. These preference shares, which carry a 10% coupon, were due to be paid back in two years’ time or else Songbird faced sharply soaring interest costs on them.
Today’s deal lowers the cost of the preference shares and secures stable financing until 2017 for the company. It also allows Songbird to pay dividends to ordinary investors without the permission of the preference holders. The shares rose 1.5p to 105p. Chairman David Pritchard said: “The board believes that the proposed amendments... offer the most appropriate means of securing efficient long-term finance for the company, at the same time as facilitating the potential payment of future dividends on the ordinary shares.”
