Eight years after Intu acquired the Trafford Centre from Peel in a £1.65bn deal which saw Peel chairman John Whittaker take a 20% stake in the company, Whittaker is now leading an attempt to buy the rest of Intu’s shares.
Yesterday a consortium made up of Peel Group, Saudi Arabia’s Olayan Group and asset manager Brookfield Property Group confirmed it was considering a cash offer to buy shopping centre owner Intu for £2bn.
Peel Group is Intu’s largest shareholder, with a 27% stake. Olayan has 2% of Intu’s shares, and also owns 25% of Peel, having bought into the company as part of a property acquisition in 1987.
Whittaker’s Peel Group sold the Trafford Centre in 2010 in a deal that valued the building at £1.65bn, with Peel taking £75m cash and a 19.9% stake in purchaser Capital Shopping Centres, which rebranded as Intu in 2013. Whittaker became deputy chairman of Intu.
As of yesterday evening, Intu said it had not received an approach from the consortium. The board has formed an independent committee made up of all directors of Intu other than John Whittaker, due to his connection to the consortium.
The potential acquisition is at a “preliminary and exploratory stage” according to the consortium. It will be required to confirm whether or not it is making a firm offer for the company by 1 November.
Retail sector specialist Hammerson was set to acquire Intu earlier this year, but pulled out of the £3.4bn deal in April after a drop in profits and its shareholder’s views that the UK retail sector was “declining”.
Intu’s share price this morning jumped by 43p to a value of 191p a share.