Iconic Australian shopping centre operator Westfield has agreed to sell its portfolio to European retail giant Unibail-Rodamco for a fee of AU$32.7bn.
Longstanding owner Sir Frank Lowy started the business with a single shop in Sydney in 1950, and after almost seven decades has decided to pass on ownership.
On announcing the news, Lowy said: ““The transaction announced today is the culmination of the strategic journey Westfield has been on since its 2014 restructure. We see this transaction as highly compelling for Westfield’s securityholders and Unibail-Rodamco’s shareholders alike.
“Unibail-Rodamco’s track record makes it the natural home for the legacy of Westfield’s brand and business. We look forward to seeing Westfield continue to grow as part of the world’s premier owner of flagship shopping destinations.”
But what are the main features of the deal, and what kind of retail superstructure will this move create? Here are X facts you need to know:
- The agreed fee of AU$32.7bn represents a 17.8% share price premium (around AU$10 a share).
- The deal includes 35 Westfield shopping centres located in the US and the UK, which contain 6,400 retail outlets and is worth AU$42.31bn.
- Unibail-Rodamco is an even bigger operator of retail centres, managing 69 shopping centres in 11 European countries with assets worth AU$56.26bn.
- Combined, the new company will own 104 assets worth around AU$100bn.
- It will be present in 27 of the world’s most prolific retail cities and destinations, with a total visitation of 1.2bn people a year.
- Such destinations include: London, Los Angeles, Munich, New York, Paris, San Francisco, San Jose, Stockholm, Vienna, Madrid and Warsaw.
- Among the flagship shopping centres to be under one umbrella company include: Westfield London, Westfield Stratford City, Les Quatre Temps, Westfield Century City, Le Forum des Halles, Westfield World Trade Center, La Maquinista, Shopping City Süd, Mall of Scandinavia, Centrum Chodov and Arkadia.
- The deal will see a combination of two development pipelines worth around €AU$19.15bn, including investments in London, Milan, Hamburg, Brussels, Paris, San Jose, Lyon and other major cities.
- Following the transaction, Unibail-Rodamco will maintain its two-tier board structure which consists of a supervisory board and a management board.
- Christophe Cuvillier will be the Group Chief Executive Officer and Colin Dyer will be the Group Chairman of the Supervisory Board.
- Upon the closing of the transaction, Unibail-Rodamco shareholders and Westfield securityholders will hold Unibail-Rodamco stapled securities, each comprising one Unibail-Rodamco share and one share in a newly formed Dutch company, Newco, which will hold Westfield’s US operations.
- The acquisition is subject to regulatory approvals, which include passing though the Australian courts.
- Unibail-Rodamco hopes to close the deal in Q2 of 2018.
Current Unibail-Rodamco CEO Cuvillier said: “All of us at Unibail-Rodamco have immense respect for what the Lowy family and the Westfield team have accomplished with the Westfield brand and the company’s iconic collection of world class shopping destinations.
“The acquisition of Westfield is a natural extension of Unibail-Rodamco’s strategy of concentration, differentiation and innovation. It adds a number of new attractive retail markets in London and the wealthiest catchment areas in the United States.”