Farewell Westfield, welcome Intu at Merry Hill

Intu takes a slice of Merry Hill in £408m deal

Property group Intu has acquired a 50 per cent interest in the Merry Hill Shopping Centre for more than £400m.

It is part of a £867.8m deal which also includes the takeover of Derby’s Westfield centre and Sprucefield retail park in Northern Ireland.

The shopping centre group is funding the acquisition through new debt facilities totalling £423.8m and a rights issue which is intended to raise gross proceeds of approximately £500m and net proceeds of about £488m.

Merry Hill in Brierley Hill, near Dudley, was developed in the late 1980s. It has 1.4 million sq ft over two retail levels with 214 shop units and a further 300,000 sq ft of other adjacent retail space generating net annual rent of almost £55m.

About 25 million shoppers are attracted to the centre, which is anchored by Marks & Spencer, Debenhams, Bhs, Primark, Sainsbury’s, Next and Asda, each year. The centre currently has an occupancy of about 96 per cent.

Westfield holds its interest in Merry Hill jointly with QIC, which will retain its 50 per cent holding after the acquisition.

Intu will be appointed as asset and development manager for centre and it will be rebranded as intu Merry Hill.

The group agreed to pay £407.7m for the stake in Merry Hill.

Intu chief executive David Fischel said: “The transaction is a rare and attractive opportunity to acquire a further two prime shopping centres in line with our strategy to focus on the UK’s largest and most successful destinations.

“The acquisition strengthens Intu’s position as the leading owner, developer and manager of prime UK shopping centres filling in gaps in our national coverage and extending the footprint of our nationwide consumer facing brand and digital strategy.

“We are delighted to establish a partnership with QIC, a major global investor, at Merry Hill.”

Intu already owns The Potteries centre in Stoke and the Victoria and Broadmarsh centres in Nottingham

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