Canary Wharf (Songbird Estates PLC)
KHC investments begin: 1995
Based: London, UK
With its initial investment in the mid-1990s, Kingdom Holding Company helped enable completion of London’s landmark Canary Wharf real estate project.
The sponsors of the Canary Wharf development first approached Prince Alwaleed in 1995, at a time when the project had entered receivership. Recognizing the potential of one of Europe’s largest real estate developments, KHC was able to capitalize on the project by structuring a privately negotiated investment with the support of a consortium of other investors. It was this initial investment, and Prince Alwaleed’s ability to form a high-value consortium, that enabled successful completion of the landmark Canary Wharf project.
Canary Wharf’s holding company completed its public listing in 1999. Prior to the offering, KHC’s total dividends not only matched the initial investment, but also provided a healthy return. In 2001, KHC elected to sell two-thirds of its investment in the project. A subsequent “cornerstone” investment was made in 2004 by a Morgan Stanley-led consortium that, through its Songbird Estates acquisition vehicle, acquired control of Canary Wharf’s holding company, taking it private.
Songbird Estates was subsequently listed on the AIM Market of the London Stock Exchange and approximately one-third of KHC’s investment was sold at a significant gain.
Songbird Estates is a UK-based real estate group involved principally in the management of its investments. Its principal subsidiary, Canary Wharf Group, specializes in integrated property development, investment and management.
Songbird holdings extend beyond Canary Wharf to other London properties. Songbird reported underlying pretax profit of GBP 4.6m for 2011 and net year-end assets valued at GBP 1,452.1m.