Intu Holders May Throw in The Towel If Offer Made: Green Street
2018-10-05 06:44:34.745 GMT
By Neil Callanan
(Bloomberg) -- Highly concentrated ownership of Intu means
the probability of a successful bid by Brookfield Property
Group, Olayan Group and the landlord’s largest shareholder, Peel
Group, appears high, Green Street Advisors says in a note to
clients
* With negative total shareholder returns over multiple time
periods, “who can blame Intu investors if, after much patience,
they finally throw in the towel?” analysts including Hemant
Kotak write in note titled “Damned if They Do, Damned if They
Don’t”
* Possible bid seen of as much as GBP2 a share, a premium of
about 35% to current share price
** A higher offer would likely be requested, but a bid of about
GBP2.20 a share would be a discount of about 15% to Intu’s asset
value and, at that level, Brookfield may decide that U.S. malls
are more attractive
* If there ends up being no bid, despite the deep discount,
investors will question just how wide the bid-ask spread really
is
** If management demand more than GBP4-GBP5 a share, “what is
next for the company, given the going-concern outlooks, is
bleak”
* A deal done at a deep discount could send private market
valuations into a tailspin as high-quality malls historically
command a big premium
* NOTE earlier: Brookfield Venture Considers Offer for U.K. Mall
Owner Intu
To contact the reporter on this story:
Neil Callanan in London at ncallanan@bloomberg.net
To contact the editors responsible for this story:
Heather Harris at hharris5@bloomberg.net
Tom Lavell
2018-10-05 06:44:34.745 GMT
By Neil Callanan
(Bloomberg) -- Highly concentrated ownership of Intu means
the probability of a successful bid by Brookfield Property
Group, Olayan Group and the landlord’s largest shareholder, Peel
Group, appears high, Green Street Advisors says in a note to
clients
* With negative total shareholder returns over multiple time
periods, “who can blame Intu investors if, after much patience,
they finally throw in the towel?” analysts including Hemant
Kotak write in note titled “Damned if They Do, Damned if They
Don’t”
* Possible bid seen of as much as GBP2 a share, a premium of
about 35% to current share price
** A higher offer would likely be requested, but a bid of about
GBP2.20 a share would be a discount of about 15% to Intu’s asset
value and, at that level, Brookfield may decide that U.S. malls
are more attractive
* If there ends up being no bid, despite the deep discount,
investors will question just how wide the bid-ask spread really
is
** If management demand more than GBP4-GBP5 a share, “what is
next for the company, given the going-concern outlooks, is
bleak”
* A deal done at a deep discount could send private market
valuations into a tailspin as high-quality malls historically
command a big premium
* NOTE earlier: Brookfield Venture Considers Offer for U.K. Mall
Owner Intu
To contact the reporter on this story:
Neil Callanan in London at ncallanan@bloomberg.net
To contact the editors responsible for this story:
Heather Harris at hharris5@bloomberg.net
Tom Lavell