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| Europe's biggest mall owner snaps up Westfield for $25bn | Europe's biggest mall owner snaps up Westfield for $25bn |
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| Europe’s biggest commercial property company is to buy Westfield, the company behind two big shopping centres in London, in a $25bn (£18.5bn) deal which will make it the largest mall operator in the world. | |
| In the latest property sector shakeup, France’s Unibail-Rodamco, which owns Forum des Halles in Paris, has agreed to buy the Australian mall owner for $24.7bn, with plans to roll out Westfield centres in Europe and the US. The Lowy family, Westfield’s biggest shareholder, is selling its 9.5% stake for a mixture of cash and Unibail shares, which it intends to keep. | |
| The growth of online shopping, fuelled by the online behemoth Amazon, is forcing shopping centre operators to focus on the best assets. | The growth of online shopping, fuelled by the online behemoth Amazon, is forcing shopping centre operators to focus on the best assets. |
| It is the second large-scale property deal in the past week: Hammerson, which owns Birmingham’s Bullring shopping centre, agreed to buy Intu, the company behind Manchester’s Trafford centre, in a £3.4bn deal that will create Britain’s biggest property company worth £21bn. | |
| Westfield runs the malls in Shepherds Bush, west London, and at Stratford, east London. It has plans to build a third centre in Croydon, south London. Its total portfolio of 35 malls includes centres in Italy, the US and Australia. Unibail, Europe’s biggest mall operator, runs 69 shopping centres across 11 EU countries but lacks a presence in the UK and US. | |
| Christophe Cuvillier, chief executive of Unibail, said the takeover of Westfield “adds a number of new attractive retail markets in London and the wealthiest catchment areas in the United States”. | |
| Jaap Tonckens, the French company’s chief financial officer, told Bloomberg TV that despite the popularity of online shopping, malls still had a future. “Especially younger people do their research on their phones and then go to malls to get what they want and to hang out with their friends and have a meal ... You are talking about people wanting an experience.” | Jaap Tonckens, the French company’s chief financial officer, told Bloomberg TV that despite the popularity of online shopping, malls still had a future. “Especially younger people do their research on their phones and then go to malls to get what they want and to hang out with their friends and have a meal ... You are talking about people wanting an experience.” |
| Both company boards unanimously recommended the deal. The news comes a few days after Frank Lowy, the Westfield chairman and co-founder, received a knighthood. He and his sons – Steven and Peter – who are co-chief executives, will step down but Lowy will chair an advisory board for the new firm. | Both company boards unanimously recommended the deal. The news comes a few days after Frank Lowy, the Westfield chairman and co-founder, received a knighthood. He and his sons – Steven and Peter – who are co-chief executives, will step down but Lowy will chair an advisory board for the new firm. |
| The Westfield business empire grew out of a delicatessen and later a shopping centre founded in Sydney in the 1950s by Lowy – now one of Australia’s richest men – and the late John Saunders, both immigrants from Hungary who survived the Holocaust. According to Saunders’ adopted daughter Betty Saunders-Klimenko, the two men “were in a field in the western suburbs when the bank told them they needed a business name”, and so the name Westfield was born. | |
| Analysts at Morgan Stanley said: “Both companies have a similar strategic vision but arguably with a materially different regional footprint. As such, the deal would plug the last remaining holes in Unibail-Rodamco’s European dominant positioning – now also UK and Italy – and give the group access to a high-quality portfolio in the US.” | Analysts at Morgan Stanley said: “Both companies have a similar strategic vision but arguably with a materially different regional footprint. As such, the deal would plug the last remaining holes in Unibail-Rodamco’s European dominant positioning – now also UK and Italy – and give the group access to a high-quality portfolio in the US.” |
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