Merry Hill sale ditched af­ter tur­moil in mar­ket

Birmingham Post - - COMMERCIAL PROPERTY - Tam­lyn Jones Busi­ness Cor­re­spon­dent

APROPOSED £2.8 bil­lion takeover of Merry Hill cen­tre owner Intu has been aban­doned be­cause of volatil­ity in the re­tail sec­tor.

A con­sor­tium of in­vestors had been in dis­cus­sions with Intu over a pos­si­ble buy­out of the firm which owns 17 shop­ping cen­tres across the UK and three in Spain.

But in a state­ment to the Stock Ex­change, Intu an­nounced that the con­sor­tium had with­drawn its of­fer and the deal would not go ahead.

The state­ment said: “The con­sor­tium has an­nounced that, given the uncer­tainty around cur­rent macroe­co­nomic con­di­tions and the po­ten­tial near-term volatil­ity across mar- kets, it is not able to pro­ceed with an of­fer within a time frame which is man­age­able within the con­fines of the Code timetable.”

The con­sor­tium com­prised UKbased Peel Group, Mid­dle East in­vestor Olayan Group and Brook­field Prop­erty Group, an as­set man­ager head­quar­tered in Canada.

Talks on the buy­out of Intu were granted three dead­line ex­ten­sions dur­ing Novem­ber by The Panel on Takeovers and Merg­ers but the lat­est one was due to ex­pire at 5pm on Novem­ber 30. Two weeks ago, it looked as though the buy­out would go ahead af­ter the con­sor­tium had al­most com­pleted its le­gal, tax, ac­count­ing and com­mer­cial due dili­gence on the deal.

Peel Group’s ac­tiv­i­ties are fo­cused mainly on prop­erty and de­velop- ment in Greater Manch­ester and Mersey­side. The firm built and ran the Traf­ford Cen­tre in Greater Manch­ester, which is one of the UK’s largest shop­ping cen­tres, be­fore sell­ing it to Intu, then known as Cap­i­tal Shop­ping Cen­tres, in 2011 for £1.6 bil­lion.

At that time, it was the largest prop­erty deal in Bri­tish his­tory and gave Peel a stake of 23 per cent in Cap­i­tal Shop­ping Cen­tres which was re­branded as Intu in 2013.

Intu has been car­ry­ing out a £100 mil­lion over­haul of the Merry Hill cen­tre, in Dud­ley, in­clud­ing re­vamp­ing the bus sta­tion and sign­ing deals with a string of new re­tail­ers.

Intu’s state­ment added: “Fol­low­ing the with­drawal of the pos­si­ble of­fer, Intu in­tends to re-en­gage with ma­jor share­hold­ers, in­clud­ing Peel, and also com­plete the ap­point­ment of a suc­ces­sor to the cur­rent chief ex­ec­u­tive where the search is on­go­ing.”

Ham­mer­son, the prop­erty group which co-owns Bull­ring and Grand Cen­tral in Birm­ing­ham, has been among Intu’s pre­vi­ous suit­ors, tabling a £3.4 bil­lion bid ear­lier this year but that deal also fell through.

> Intu Merry Hill shop­ping Cen­tre

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