Harworth board re-iterates rejection of £583m takeover bid after Peel Group publishes offer documents

The board of land company and developer Harworth Group has re-iterated its “unanimous and unequivocal” rejection of a rival’s bid to takeover the company.

The Peel Group, the developer behind MediaCity and TraffordCity, made a 172.5 pence per share cash offer to acquire the entire issued shares of the Yorkshire-based firm earlier this month.

The offer, which values Harworth at approximately £583m, was rebuffed at the time by the company’s board, but Peel yesterday published details of the offer document, setting out the “strategic and financial rationale” for its bid.

Explaining its decision, Peel said Harworth’s public listing and business strategy will not generate appropriate risk-adjusted returns for shareholders and suggested the business should pivot toward strategic land activities and selective development.

In response, Harworth’s board emphasised that “as previously announced, the Board is unanimous and unequivocal in its rejection of the Offer which, in its view, fundamentally undervalues Harworth and its near and longer-term prospects”.

“The Board is reviewing the offer document with its advisers and will, by no later than 9 September 2026 (except with the consent of the Takeover Panel), publish a circular to Harworth shareholders setting out in full the Board’s views on the Offer and the reasons for the Board’s unanimous and unequivocal rejection of the Offer,” it said.

“In the meantime, Harworth shareholders are strongly advised to take no action in respect of the Offer. In particular, shareholders are advised not to sign or return any form of acceptance and not to submit any electronic acceptance in respect of their Harworth shares.”

Peel believes Harworth’s cash flow profile is “increasingly becoming less sustainable”, driven by its increasing administrative cost base and net finance costs, which have risen 103% in four years.

It said Harworth’s direct development and hold strategy was “capital-intensive, slow to deliver value and increasingly unable to generate appropriate risk adjusted returns”.

It suggested a model based on strategic land activities and selective development would have a lower cost base and could be more effectively executed with a private-company structure.

It also said Harworth’s data centre strategy was “very early stage, highly speculative and unlikely to convert to cash sales or deliver the contribution” required to improve returns within the short to medium term.