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Mon 28 Jan 2019 09:15 AM

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UK firm in talks to sell mall stake to Kuwaiti-backed fund

Deal would create a joint venture between London-based Intu and Cale Street Partners

UK firm in talks to sell mall stake to Kuwaiti-backed fund
Intu bought the shopping centre, located in the city of Derby, England, five years ago in a deal worth about 390 million pounds ($514.8 million).

Intu Properties is in talks to sell a 50 percent stake in one of its English shopping centres to a Kuwaiti-backed fund, the UK’s Sunday Times reported, without saying where it got the information.

The deal would create a joint venture between London-based Intu and Cale Street Partners, the report said. Intu bought the shopping centre, located in the city of Derby, England, five years ago in a deal worth about 390 million pounds ($514.8 million).

Selling the shopping centre would bring in much-needed cash for Intu, which has debts of more than 4.5 billion pounds. Last year, the company slashed its dividend to reinvest in its portfolio after a group of investors - including British billionaire John Whittaker - withdrew a takeover bid in November.

The day before the investors pulled out of the deal, the Bank of England said the prices of malls, offices and hotels could fall by almost 50 percent if Britain leaves the European Union without a deal. Last April, Intu rival Hammerson Plc also abandoned an attempt to acquire the business.

Cale Street Partners is a London-based investment fund focused on European real estate. Kuwait’s sovereign wealth fund provided seed $1.5 billion in seed funding the business, according to market research company Oxford Business Group.

Intu and Cale Street Partners didn’t respond to requests for comment from Bloomberg.

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