Slough Estates to undo Tesco joint venture

Slough Estates is to unwind its 50/50 property joint venture with Tesco, the largest supermarket group in the UK, newspaper the Sunday Telegraph reported, citing a statement by Slough's ceo Ian Coull.

The owner of six of the UK's 10 largest business parks is planning to focus on industrial property, the newspaper said. Therefore, the Shopping Centres venture, owned jointly by Slough and Tesco, ceases to be part of its strategic assets. Slough and Tesco own two shopping centres in York, England, and London's Docklands. The properties, valued at EUR 227 mln net of debt, are both undergoing a EUR 9.2 makeover.

The supermarket group, which has the right of first refusal to buy the 50% it does not own, can also choose to retain only its 50% stake. Slough's ceo Coull said the company will need to sell shares within the next three years. A review of the business is expected to lead to a EUR 1.5 bn sale, researchers at merchant bank Kempen & Co said.