Intu the breach

20 January 2020 By Karen Kwok Follow @KarenKKwok

Intu, the struggling landlord of retailers like Zara and Primark, is looking to raise equity to fix its $6.1 bln debt. Doing so would underpin the UK’s post-election property and stock market gains. But given the scale of what Intu needs, it may instead expose their fragility.

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British shopping centre operator Intu Properties said on Jan. 20 that it was in talks with shareholders and potential new investors for an equity raise by the end of February in a bid to shore up its balance sheet.

The Sunday Times reported on Jan. 19 that Intu was planning to tap 1 billion pounds ($1.3 billion) of emergency cash.

“Occupancy was stable at 95 per cent and to date 97 per cent of rent has been collected for the first quarter of 2020 demonstrating the lower risk of our existing customer base,” Matthew Roberts, the chief executive of Intu, said. “We are making good progress with fixing the balance sheet, our number one priority.”

In early November, the owner of Manchester's Trafford Centre said it was considering raising equity, along with the sale of assets, to trim its balance sheet. As of June 30, 2019, Intu has 4.7 billion pounds of debt.

Shares of Intu were down 4.8% to 21.31 pence at 0912 GMT on Jan. 20, giving Intu a market capitalisation of 288 million pounds.

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