Hammerson’s confirmation that it is in talks to sell off its seven British retail parks and bring in some much-needed cash did nothing for the share price this morning.
Responding to weekend reports, the shopping centre owner — one of Britain’s biggest — admitted that it had been approached by Brookfield, the Canadian private equity firm, and that the two were in discussions.
It was reported in The Sunday Times that Brookfield was offering to pay about £350 million for the retail parks in Falkirk, Didcot, Middlesbrough, St Helens, Telford, Merthyr Tydfil and Rugby. That is about £50 million less than what Orion, another private equity group, had agreed to pay for the parks last year before it walked away from the deal.
Despite the price drop, Colm Lauder, a real estate analyst at Goodbody, suspected that the mooted offer was better than what many in the market had feared. He said the sale was “an important transaction” for Hammerson as it bids to clear some of its £2.2 billion debt pile. Still, the shares fell ½p, or 1.3 per cent, to 37p, although they had fallen to as low as 35¼p not long after the opening bell.
Many of Hammerson’s tenants were able to reopen their shops today, although investors generally steered clear of retail stocks. Next, the seller of clothes and homeware, retreated 184p, or 2.2 per cent, to £81.12; Kingfisher, the B&Q owner, shed 7¼p, or 2.1 per cent, to 336½p; and WH Smith fell 23p, or 1.3 per cent, to £17.99.
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The wider market was similarly subdued. The FTSE 100, which hit a 13-month high last week, eased back 20.92 points, or 0.3 per cent, to 6,894.83 and the FTSE 250 dipped 41.02 points, or 0.2 per cent, to 22,210.24 having hit a new record on Friday.
Mining stocks were among the laggards as they tracked metals prices lower. Evraz, the Russian steel group, lost 8¼p, or 1.4 per cent, to 591p; Anglo American, which owns the De Beers diamond business, fell 39½p, or 1.3 per cent, to £30.44; and Antofagasta, the Chilean copper miner, reversed 21p, or 1.2 per cent, to £17.09.
Howden Joinery, the designer and maker of fitted kitchens, was the stand-out winner among London’s biggest companies, gaining 17¼p, or 2.3 per cent, to reach a high of 777½p. That was after analysts at Numis upgraded their retain of the stock to “buy” having concluded that the company’s “growth runway remains substantial”.