Paul Reichmann, the founder of Canary Wharf, will not launch his own bid against Morgan Stanley for control of the UK property group but instead join forces with Brascan, the Canadian real estate developer.

Reichmann, who owns 8.9% of Canary Wharf's shares, said he would not be in a position to make an offer by the end of January - the deadline set by him and Brascan as part of an agreement made in December. He will now help the Brascan consortium prepare a fresh bid for the property group by February 13, and make a "significant investment".