UK REIT Hammerson has a made a recommended £3.4 bn (€3.86 bn) offer for an all-share takeover of its smaller peer intu, in a deal which would combine the two largest UK retail REITs to create a group with a £21 bn (€23.8 bn) pan-European portfolio.
The enlarged group will be led by David Atkins as CEO, and Timon Drakesmith as CFO and will be called Hammerson plc.
'This transaction will deliver real value for shareholders,' commented David Tyler, chairman of Hammerson. '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.'
Tyler will be chairman of the enlarged group, while John Whittaker, deputy chairman of intu, will become deputy chairman. John Strachan, chairman of Intu, will join the board of the enlarged group as senior independent director.
According to both companies, the combination will offer growth prospects with exposure to the rapidly growing economies of Ireland and Spain, as well as providing additional sources of capital to forge ahead with ambitions to expand the Premium Outlets platform.
An anticipated disposal programme of at least £2 bn will significantly rationalise the enlarged group's portfolio.
'A combination of both Intu and Hammerson will create a more resilient, diversified and stronger group that we believe will benefit all our stakeholders,' said intu chairman Strachan. '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.'
According to both companies, Intu shareholders will receive 0.475 new Hammerson share for each Intu share.
The all-share offer represents a value of about 253.9 pence per Intu share, 27.6% higher than its Tuesday close.
