Malls giant working on £1.3 billion fundraiser

£461.6million, with pre-tax losses growing by £130million to £1.27billion. The shares have lost 96 per cent of their value over the past five years and on Friday closed down at 2.03p per share, valuing the company at just £171million.

Analysts warn that any rescue is likely to massively erode the value of existing investors’ stakes. They explained that the fundraising will need a new cornerstone investor to buy up a large chunk of new shares that will be issued, as well as underwrite the cost of the exercise.

Peel Hunt real estate analyst James Carswell warned: “The dilution is going to be massive. If you’re a shareholder and you are not or cannot take part in the refinancing, you’re probably going to get wiped out.”

Robert Duncan, an analyst at broker Numis, said potential investors may be put off by the uncertainty over Intu’s earning power and the scale of any write-offs it needs to make, as well as what its capital needs are just to maintain its malls in decent condition. “I’m struggling to see what the positive investment case is for participating in the recapitalisation,” he said.

Intu is controlled by ports tycoon John Whittaker, who has a 27.32 per cent stake. Last week it suffered a blow when potential saviour Link, a Hong Kong property investment trust, walked away just one day after Intu named it as being interested in its fundraising.

Last weekwestfield said it had put plans on hold to build a £1.4billion mall to replace two shopping centres in Croydon, south London.