Could Hammerson sell stake in Bicester Village owner?

By

Sandra Halliday

Published
Sep 4, 2019

Just a day after Hammerson and APG said they’re taking full control of Via Outlets, comes news that the UK mall operator may be mulling the sale of its £1.9 billion stake in Value Retail, the company that operates the wildly popular Bicester Village mall. Hammerson hasn’t commented on the story that was reported by the React News property website.

Hammerson has a 39% stake in Value Retail, which itself owns nine shopping villages across Europe. Value Retail was one of the minority owners whose Via Outlets stake Hammerson and APG have just acquired.

So why would it want to sell its holding in a hugely successful business just after it has added to its holding in another outlets specialist?

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Well, since it rebuffed the takeover approach from France’s Klépierre and since the failed merger with Intu, Hammerson has been under pressure to maximise value for its shareholders. American activist investor Elliott Advisors owns a 5% stake in the firm and has been pressing it to dispose of assets on which it can realise a big return. Hammerson agreed to set up a non-executive director committee to oversee asset disposals.

Hammerson last year spent £76 million to increase its share in Value Retail and has varying stakes in the firm’s different villages. The purchase meant it now owns more than 50% of Bicester Village. That location alone sees the highest sales per square foot of any shopping destination globally and it’s the second most-visited destination in England by Chinese tourists. 

Value Retail, and Bicester in particular, have major future potential too as outlets have outperformed other retail segments and are predicted to grow 6% annually up to 2025. That means selling its stake would offer the company a big instant payoff as the business would be expected to fetch a healthy price premium.