Beleaguered Trafford Centre owner wins breathing space with banks

The beleaguered owner of the Trafford Centre and Arndale Centre has won some breathing space after agreeing to extend its overdraft.

Intu is thought to be struggling with debts of £5bn and has warned that the problems in the retail sector are not going to slow down any time soon.

Earlier this month Far East investors pulled the plug on a deal to raise around £1bn in funds.

The firm, which has also been the target of two failed takeover bids, has agreed an extension to its overdraft facility.

The seven banks providing Intu with its revolving credit facility have agreed to a new four-year £440m overdraft.

However, the overdraft is conditional on the firm raising at least £1.3bn in a rights issue.

The firm has seen its share price plummet by 90 per cent in the last 12 months.

The business has announced it will issue a call for funding when its full year results are published next week.

Matthew Roberts, Intu’s chief executive, said “This extension of our RCF is a key milestone in addressing our near-term refinancing needs. It also underlines the continued support we have from our relationship banks.
“Fixing the balance sheet remains our number one priority and we remain engaged with shareholders and potential new investors in relation to the intended equity raise.”

Rob Virdee, an analyst at the property consultancy Green Street Advisors, said lower amount being lent by banks suggested they did not want to increase their exposure to Intu.