Canary Wharf Group says it has entered into exclusive talks with a consortium led by US investment bank Morgan Stanley with a view to backing a $1.5 billion pound takeover bid.
Canary Wharf, the owner of Britain's tallest building, said today the consortium, which also includes US investment bank Goldman Sachs, planned to offer 220 pence per share in cash plus 35 pence per share in equity.
The Morgan-Goldman group, which has the backing of US investor Mr Simon Glick, a 14 per cent shareholder in Canary Wharf, had previously offered 250p per share in cash and equity, sources said.
The move brings a five-month long bidding war nearer to an end but it is by no means certain a deal will be done.
At Friday's close, a rival proposal was on the table from Canadian conglomerate Brascan Corp.
Another wild card is how founder Paul Reichmann, who owns about 7 per cent of Canary Wharf and more in warrants, will react.
The revised Morgan-Goldman offer is about 9 per cent above Canary Wharf's closing share price on Friday of 234-1/4p. The firm, which has built a financial district on derelict docklands in eastern London, had sought an offer closer to 330p per share.