RETAIL property group Grantchester Holdings is being taken off the London market in a £167.6m management buy-out.

A privately-owned company backed by investment house West Coast Capital and HBOS will run the firm, which owns 18 retail parks in the UK, including Skipper's Lane Retail Park in Middlesbrough and Mercia Retail Park in Pity Me, Durham.

Grantchester's market value has shrunk in the past two years after returning £200m from property sales to shareholders.

Chairman Nick Hewson said: "At the end of the day, if you are going to repay cash to shareholders rather than reinvesting it, you are going to get smaller and smaller.

"Is it then better to offer shareholders something at a significant premium or just carry on and see what happens? We decided to give them a choice."

Shareholders are being offered 218p per share in cash by takeover vehicle Dundonald, a premium of 6.3 per cent to the net asset value of Grantchester's properties.

Grantchester's independent directors have recommended the bid.

Mr Hewson and his management team will take a 25 per cent stake in Dundonald.

Finance director Paul Huberman is stepping down but will take up a consultancy role.

West Coast Capital and HBOS will together own 75 per cent of the new business through their respective TBH and Uberior subsidiaries.