Tycoon bids £2.9bn for shopping centres
Intu jumps 12pc after 215p-a-share takeover offer
PROPERTY mogul John Whittaker has launched a £2.9bn takeover bid for one of Britain’s biggest shopping centre groups.
The 76-year-old has joined forces with Brookfield Property Group of Canada and Saudi Arabia’s Olayan Group to swoop for Intu, whose empire includes Braehead in Glasgow, the Metrocentre in Gateshead and Manchester’s Trafford Centre.
The offer valued Intu shares at 215p each. The stock jumped 12.6pc, or 22.3p, to 200p, leaving it some way off the offer price, suggesting investors are sceptical over whether a deal will be agreed.
Analysts at Liberum said shareholders may not accept any offer below 239p a share, or £3.2bn.
Whittaker is deputy chairman of Intu and owns a 27pc stake through his firm Peel Group.
His offer is far below the £3.4bn rival shopping centre owner Hammerson offered for Intu before their deal collapsed earlier this year.
Intu said Whittaker and his consortium of investors increased their possible bid from 205p after meeting to discuss the deal.
But Russ Mould, investment director at AJ Bell, added: ‘It could hardly be construed as generous, particularly as any dividends paid before the deal completes will be taken off the offer price.
‘An imminent revaluation of Intu’s assets might cast the price in a better light, as many analysts believe retail sector property valuations will have to be marked down.’
Hammerson, which owns Bicester Village and Brent Cross Shopping Centre, was embarrassed earlier this year when it was forced to walk away from a takeover of Intu due to shareholder opposition. Its shares climbed 0.5pc, or 2.4p, to 447.3p last night.
Intu’s chief executive David Fischel subsequently stepped down as the company swung to a loss and warned of lower growth in rental income. But experts have said renewed interest in a takeover of Intu is a sign of confidence in the retail sector at a time when companies such as Marks & Spencer, House of Fraser and New Look are all closing shops.
The £2.9bn proposal is in contrast to the total value of Intu’s assets, which are worth £5.6bn. The value of retail sector properties has slumped amid uncertainty over further store closures or retail failures, after Toys R Us, Poundworld and Maplin went bust earlier this year.
Retailers are also busy renegotiating rents with landlords as they battle with rising staff costs and crippling business rates and an onslaught from online rivals. A spokesman for Intu said last night that the company ‘intends to issue a trading update for the period from July 1 as soon as practicable, which will include the outcome of an updated independent valuation of the company’s investment and development properties as at September 30’.