Shopping centre owner Hammerson has said it is no longer recommending that shareholders vote in favour of its acquisition of Intu, just months after announcing an all-share offer for the firm.
Hammerson, which owns the Victoria Gate development in Leeds, said it believed that the proposed acquistion of Intu, which operates the Trafford Centre in Manchester, is no longer in the best interest of shareholders.
The firm said: “The Hammerson Board firmly believed in the strategic rationale of combining Intu’s portfolio with Hammerson’s, under the leadership of the Hammerson management team, and the opportunity it provided for value creation in the medium to long term.
“The board has now concluded that the proposed Intu acquisition is no longer in the best interests of shareholders.”
Hammerson detailed the reasons it was withdrawing its recommendation, including that the stock market’s view of the UK retail property market had “deteriorated” since the start of the year.
“This perception has been intensified by market concerns over the extended period of time that it would take to complete the transaction and realise longer-term returns from the Intu acquisition,” it said.
Chairman David Tyler said: “After careful consideration, the board has concluded it is no longer in the best interests of shareholders to carry out the Intu acquisition.
“In recent weeks, investors have told us they share our view of the exceptional quality of our portfolio and that they have great confidence in our management team.
“The board has complete conviction in Hammerson’s prospects as a standalone business as we pursue our plans for future growth.”