Hammerson, a prominent mall operator in the UK, is currently contemplating the sale of its £1.9 billion stake in Value Retail, the company responsible for the highly successful Bicester Village mall. This news has emerged shortly after Hammerson and APG announced their acquisition of full control of Via Outlets, adding another layer of complexity to the company’s strategic decisions.
Value Retail, which operates nine shopping villages across Europe, has been a significant asset for Hammerson, who currently holds a 39% stake in the company. Although Hammerson has not officially confirmed the potential sale of this stake, reports from the React News property website suggest that the company is exploring this option. Given the recent acquisition of Via Outlets, some industry experts may find Hammerson’s deliberation on divesting its share in Value Retail a surprising development.
The pressure on Hammerson to generate value for its shareholders has intensified following the collapse of a proposed merger with Intu and the rejection of a takeover bid from Klépierre. Activist investor Elliott Advisors, who owns a 5% stake in the company, has been vocal about Hammerson’s need to offload assets to yield significant returns. In response to these demands, Hammerson has set up a non-executive director committee to supervise the process of asset disposals.
Last year, Hammerson made a substantial investment of £76 million to increase its ownership stake in Value Retail, thereby becoming the majority owner of Bicester Village. Known for its exceptional sales performance per square foot and popularity among Chinese tourists, Bicester Village represents a lucrative asset for Hammerson. Outlet shopping destinations like Bicester Village have been surpassing other retail segments in terms of growth and are projected to maintain a consistent 6% annual expansion rate until 2025.
Given the promising outlook for outlet shopping venues, selling its stake in Value Retail could deliver an immediate substantial return for Hammerson, particularly as the business is likely to command a premium valuation. However, this potential sale raises questions about Hammerson’s overall strategic trajectory and how the company intends to navigate the evolving retail landscape in the years ahead.
For more information on Hammerson and its recent developments, visit their official website here. To learn more about Value Retail and its portfolio of shopping villages, click here.
