The deal enables Unibail-Rodamco - which is Europe's largest publicly traded commercial real estate company - to expand its presence into "a number of new attractive real estate markets", including London and wealthy areas in the U.S., Cuvillier said in a statement. Unibail-Rodamco, which is the largest mall operator in Europe, will replace its properties with the Westfield logo. It owns 69 shopping centers in 11 European Union countries, with a total property value of $42 billion, as of June 30, 2017.
And last week "Hammerson, which owns Birmingham's Bullring shopping center, agreed to buy Intu, the company behind Manchester's Trafford centre, in a £3.4 billion deal that will create Britain's biggest property company worth £21 billion", Julia Kollewe reports for the Guardian.
The Lowy family saw the move as a chance to recover value for their shareholders, the Wall Street Journal reported, while Unibail executives saw a chance to increase their company's portfolio of centers in more affluent areas of the USA and United Kingdom with a wide range of amenities, such as movie theaters.
Lowy said it made sense to sell because Unibail offered a "very good price", but acknowledged that the sale partly reflected global consolidation and the pressure on retailers. In the Los Angeles area, it has the newly renovated Century City mall, as well as its Culver City, Topanga & the Village, Fashion Square in Sherman Oaks, and Santa Anita malls. The company was built by Frank Lowy, an Australian billionaire who started with one shopping center outside of Sydney in 1959.
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Shares in Unibail-Rodamco, which was formed in 2007 by the merger of France's Unibail and Dutch-based Rodamco, were down 4.0 percent at 1500 GMT, with analysts at Kepler Cheuvreux saying that the deal looked expensive. "Shares of such companies have been hit hard and store closures are accelerating, pressuring landlords to fill empty space and reinvent shopping centers", Pooja Thakur Mahrotri and Matthew Burgess write for Bloomberg.
Westfield chairman Sir Frank Lowy will retire as chairman of Westfield, but says his family will continue to maintain a substantial investment in the new group. Westfield's portfolio is valued at $32 billion.
Unibail said it had identified cost savings of £88million, including £53million from slashing corporate overheads.