Bullring owner to take over Merry Hill firm in £3bn deal
THE owner of Birmingham’s Bullring and Grand Central shopping centres is set to take over rival Intu.
Hammerson has agreed an all share takeover of Intu, which owns the Merry Hill centre in Dudley, in a £3.4 billion deal that will create Britain’s biggest property company.
It would be valued at £21 billion if the deal was given the green light by competition authorities.
The deal represents a value of approximately 253.9p per Intu share, equivalent to £3.4 billion.
The combined group will be led by Hammerson boss David Atkins and chaired by David Tyler.
Shareholders will vote on the deal next year, with Intu having already secured 50 per cent of investor support for the deal.
Mr Tyler said: “This transaction will deliver real value for shareholders. The financial strength of the enlarged group and its strong leadership team will make it well placed to take advantage of higher growth opportunities on a pan-European scale.”
The groups plan to slash costs, offload at least £2 billion worth of assets and target high growth markets such as Spain and Ireland.
Intu also operates the Trafford Centre in Greater Manchester while Hammerson owns the Martineau Galleries site in Birmingham city centre which has long been the subject of plans for a major regeneration.
Intu is in the middle of a £110 million revamp and renovation pro- gramme at the Merry Hill centre which includes bringing more high end brands to the site and adding a new cinema.
John Strachan, chairman of Intu, said: “A combination of both Intu and Hammerson will create a more resilient, diversified and stronger group that we believe will benefit all our stakeholders.
“Intu offers high-quality retail and leisure destinations in the UK and Spain, which when merged with Hammerson’s own top-quality assets in the UK, in France and in Ireland, present a highly attractive proposition for retailers and shoppers in Europe’s leading cities.”
The acquisition will result in Hammerson shareholders owning 55 per cent of the combined firm and Intu investors the remainder.
The deal comes at a time when consumer confidence has taken a pounding following the Brexit vote, resulting in a sharp decline in retail sales.
However, shopping centres in city locations have tended to fare better than high streets during economic downturns.
Mr Atkins added: “This marks an exciting milestone in the history of Hammerson. The acquisition creates a leading pan-European platform of desirable retail and leisure destinations which are better positioned to serve the needs of our retailers, excite our customers and support our partners and communities.”
The acquisition creates a leading pan-European platform of desirable retail and leisure destinations David Atkins