Shopping centre giant Hammerson pulls away from deal to buy Victoria and Broadmarsh owners Intu

The Broadmarsh Centre.

Shopping centre giant Hammerson is pulling away from a deal to buy the company which owns Nottingham’s Victoria and Broadmarsh centres.

Hammerson announced in December it had agreed a £3.4 billion buy-out with Intu, which would create the biggest property company in Britain.

But Hammerson announced on Wednesday (April 18) it is no longer recommending its shareholders vote in favour of the final plan – blaming weakening consumer confidence and fears over the number of UK retail chains which have collapsed into administration in recent months.

It means the deal is now unlikely to happen, and raises fresh questions over the future of the long-planned, delayed redevelopment of the Broadmarsh shopping centre.

Hammerson is one of the world’s biggest commercial property firms and owns hundreds of high-profile centres, including Birmingham’s Bullring and Brent Cross shopping centre in London.

The company said in a statement: “The board has now concluded that the proposed Intu acquisition is no longer in the best interests of shareholders.”

It added: “Over the last five months, the financial strength of retailers and other tenants in the UK has softened and a number of retailers have entered into administrations or CVAs, while consumer confidence has also remained subdued.

“Whilst Hammerson has proven its portfolio is well positioned to weather the current environment, the equity market now perceives a heightened level of risk associated with the UK retail property sector as a whole.”

Chief Executive David Atkins added it was ‘clear heightened risks’ to the Intu deal “now outweigh the longer-term benefits”. 

Hammerson had previously said it was ‘business as usual’ given the planned buy-out and later said publicly it was committed to going ahead with the planned Broadmarsh redevelopment.

Intu has planning permission from Nottingham City Council for an £89 million overhaul. But this is already two years behind its initial timetable, which would have seen the redeveloped centre open this year. Intu later said the work should be complete by 2020.

Artist’s impression of how the Lister Gate entrance to Broadmarsh will look after the redevelopment.

While some surrounding road and cosmetic changes have begun, the main redevelopment work has still not started.

Intu issued a statement in response to Hammerson’s announcement, saying it felt Hammerson’s explanations were ‘unsatisfactory’ because the company had underlined its commitment to the deal as recently as March 19.

It said: “The board of intu is entirely confident of intu’s commercial future and prospects. The trading update issued yesterday underlined the key strengths of intu’s business. intu will further update shareholders in due course on its plans.”

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