LISTED PROPERTY GIANT Hammerson has rejected an “opportunistic” takeover offer that it said significantly undervalued the quality of its portfolio, which includes several lucrative Dublin assets.
The UK company, which co-owns Dundrum Town Centre, the Ilac Centre and the Pavilion Shopping Centre in Swords, knocked back the £4.9 billion (€5.6 billion) approach from French mall operator Klépierre.
Hammerson has recently been in talks about a merger with British rival Intu that would create the UK’s biggest property firm, and the fresh offer is seen as an attempt to head off the link-up.
In a statement to the London Stock Exchange today, the company’s chairman, David Tyler, said the offer was “wholly inadequate and entirely opportunistic”.
“It is a calculated attempt to exploit the disconnect between our recent share price performance and the inherent value of our unique and irreplaceable portfolio which is delivering record results,” he said.
Tyler said Hammerson’s board saw “absolutely no merit” in the proposal and had unanimously rejected the approach, while it remained committed to its acquisition of Intu.
The Klépierre offer represented a 40% premium on Hammerson’s closing share price, however it was well below the company’s share value of early 2015.
Analysts have pointed to the pressure shopping centre owners are expected to come under with weak retail sales in the UK and the recent failures of several high-profile chains, including most recently Toys R Us.
Nevertheless, the Irish market has been a bright spot for the firm, which bought into an increasingly buoyant economy in late 2015 when it bought a major loan portfolio from state bad bank Nama.
It later sealed a deal with borrowers that allowed it to take joint ownership of several sites.
In addition to its existing shopping centres, the firm also owns the prime ‘Dublin Central’ in the city’s Moore Street area, although development there has been stalled by legal action to have buildings declared a national monument for their ties to the 1916 Rising.
The company has benefited from the post-recession spike in local commercial property values and rents, which pushed income at its Irish properties to £34.8 million last year.
Its like-for-like net rental income growth was 7.4% during the year, a performance Hammerson said was primarily driven by rent reviews and new lettings at Dundrum Town Centre.