RESIDENTIAL property group Grainger Trust has extended its offer to acquire an offshore investment fund after failing to secure all of the company's shares by the initial deadline.

Grainger Retirement Housing Limited (GRHL) - a division of Grainger, based in Newcastle - announced earlier this month it had bid £71.6m for Capital Appreciation Trust (CAT), the equivalent of 145.86p a share.

However, Grainger said yesterday that acceptances had been given for 41,123,324 CAT shares - only 83.79 per cent of the company, and short of the 90 per cent stake needed to declare the completion of the deal.

Grainger - the UK's largest listed residential property firm, which has already made two significant acquisitions in the past two months - had secured more than 23 million shares even before officially launching its bid for CAT's 912 UK properties on December 1, after CAT directors and several other major shareholders gave their approval to the offer.

A new deadline of noon on January 19 has now been set for the completion of the deal.

A spokeswoman for Grainger last night attributed the failure to complete the deal on the Christmas holiday period, but said the company was fully confident it would be done by the new deadline.

She said: "We didn't quite get to that 90 per cent, but we are really pleased with how much we did get considering the time of year. We are giving people that bit more time and are fully expectant the deal will go through.

"A lot of CAT shareholders are private individuals, so there is quite a long channel down from the deal to them. So we have given them a bit longer than the standard 14-day extension to help make sure everything goes through."

The acquisition of CAT's properties, most of which are Mc- Carthy and Stone developments in the South, would be another boost to Grainger's rapidly expanding portfolio.

Last month, the Newcastle plc revealed it had joined forces with property company Development Securities to make a £33.5m acquisition in Birmingham, with a view to transforming the site into a £350m commercial development.

In October, Grainger announced the £21.4m acquisition of a 308-unit residential portfolio in Munich, Germany, and opened its first European office, in Mannheim.

Earlier this month, it posted a 75 per cent rise in profits, and said it had developments in the pipeline worth £675m. In the year to September 30, the group saw a 20 per cent rise in net asset value.