China Investment Corporation, the sovereign wealth fund of China, has joined a consortium to help bail out the majority owner of London's Canary Wharf real estate development from the potential default of an £880 million loan.
AFP - China’s state sovereign wealth fund has bailed out the heavily indebted majority owner of London's Canary Wharf, the real estate development's owner said late Friday.
The Financial Times newspaper reported that the move by China Investment Corporation (CIC) was its first big investment in Britain.
The owners of Canary Wharf, Songbird Estates, said in a statement that CIC would form a consortium with Qatar Holding, the Qatari sovereign wealth fund, and a number of existing investors, to provide more than 800 million pounds (900 million euros, 1.3 billion dollars) in new equity.
The money is needed to pay 880 million pounds that Songbird owes to US bank Citigroup.
David Pritchard, the chairman of Songbird, said the deal had saved Songbird from bankruptcy.
"This deal secures the future of Songbird on the best possible basis for our shareholders," he added.
Qatar will become the largest shareholder in the group with a stake of just below 30 percent with US private investor Simon Glick taking 27 per cent and CIC taking around 19 percent, the Financial Times said.
The Canary Wharf development in east London's Docklands houses the offices of major banks and media and newspaper groups.
Date created : 2009-08-29