CANARY WHARF has agreed to pay Lazards, the investment bank, a £3.5 million fee to sell off more than £1 billion of property at its docklands estate, it emerged last night.

The fee was disclosed in a circular to shareholders which was posted out on Friday, but it did not appear in details relating to the sale, some of which appeared on the Stock Exchange screen at the end of last week.

A spokesman for Canary Wharf said yesterday that shareholders had received all the relevant information and the statement on Friday had only been a summary of the main terms.

The buildings, which include the new Citigroup tower and a building let to Credit Suisse First Boston, are being sold off to aid Morgan Stanley, the US investment bank, which has announced a 265p a share takeover bid for the docklands developer.

The sales will reduce Canary’s gearing from 183 per cent to about 128 per cent and generate about £225.2 million of surplus cashflow for the company.

This will benefit Morgan Stanley, which has made the sale a condition of its takeover offer. The circular also discloses that Royal Bank of Scotland, which is buying the buildings, will be paid a fee of £2.5 million if the sale does not proceed.

Meanwhile if the building sales proceed but Morgan Stanley’s takeover bid is not successful, Morgan Stanley will also be paid £4 million, of which Canary Wharf will pay £3 million.

The circular discloses that Brascan, a Canadian property and power company, which holds a 9.02 per cent stake, and Paul Reichmann, the company’s founder, who holds 7.75 per cent, have so far withheld their consent for the sale of the buildings. The sales are to go to a full shareholder vote on December 22.

It is expected that Brascan will vote against the sales. However, it is unclear which way Mr Reichmann will vote.

The latest fees revelation follows the announcement on Friday that Canary Wharf has agreed to pay Morgan Stanley a £7.8 million inducement fee if its £1.56 billion bid for Canary Wharf fails for “any reason”.

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