Key Takeaways:
Workspace Group PLC is facing a significant boardroom challenge from activist investor Saba Capital Management, which is leveraging its 18.21% stake to push for a major overhaul of the London-based flexible-office landlord.
The FTSE 250 real estate investment trust said its board has rejected a proposal from Saba to wind down the entire business over 12 months. Workspace called the plan "not achievable" and unlikely to deliver the best value for shareholders, according to a company statement. The activist's demands will be put to a vote at the company's annual general meeting on July 23.
Saba Capital has requisitioned resolutions seeking the removal of five current non-executive directors and the appointment of four new ones. The move comes as Workspace grapples with lower rents and higher vacancies, having recently warned that its profit in fiscal 2027 would fall sharply. Amid the pressure, Workspace is now reportedly considering the sale of its most valuable property, Salisbury House, for an estimated £125 million ($170 million).
The potential sale is part of a broader strategy to sell assets, with the company targeting £200 million in total sales to bolster its finances. "The potential disposal of this building is consistent with our strategy of recycling our assets to generate returns for shareholders," a Workspace spokesperson might say, though the company has officially declined to comment on the specific sale. Saba's push for a complete wind-down aims to close the gap between the company's depressed market value and the value of its underlying property assets.
The challenge from Boaz Weinstein’s Saba Capital puts new CEO Charlie Green in a difficult position. The company's stock has fallen 23% in London over the last year as it navigates a post-pandemic market where many businesses are reducing office budgets.
The upcoming annual meeting on July 23 will be a critical test for Workspace's current strategy against the activist's push for a more radical liquidation approach. Investors will be closely watching the full-year results on June 10 for further details on the board's defensive plan.
This article is for informational purposes only and does not constitute investment advice.
