Bicester Village sold as Hammerson offloads portfolio for £1.5bn
Retail giant Hammerson has agreed to a £1.5bn deal for its stake in Value Retail Group, disposing of its interest in nine luxury shopping villages across the UK and Europe.
Silver Bidco, a newly-formed company established by affiliates of L Catterton, has acquired the portfolio, generating cash proceeds of around £600m for Hammerson.
The group includes the popular Bicester Village in Oxford, home to 160 boutiques of British and international fashion and lifestyle brands including Alexander McQueen, Dior, Gucci, Manolo Blahnik and Prada.
Through its affiliate The Bicester Collection, Value Retail specialises in the creation and operation of luxury shopping destinations. In the UK and Europe, it operates Villages outside of major cities including Barcelona, Brussels, Dublin, Frankfurt, London, Paris, Madrid, Milan, and Munich.
Following the disposal, Hammerson says it will allocate £95m to reduce net debt and invest £350m into its existing core portfolio which includes The Bullring.
It also intends to return up to £140m to shareholders through an on-market share buyback.
Rita-Rose Gagné, CEO of Hammerson said: “This is a transformational deal for Hammerson, generating cash proceeds of c.£600m whilst removing an overweight, low yielding and minority stake, and positioning us for accelerated growth and value creation.
“The Disposal focuses our portfolio on prime urban real estate with a transformed capital structure and the capacity and capability to advance our strategy in higher yielding opportunities with stronger returns, whilst enhancing returns to shareholders.
“I’m excited about the opportunity this gives us to build on our momentum and track record of the last three years. We are at a point in the cycle where I can now be on the front foot to capture the exceptional value creation opportunities I see in the near, medium and long term. This is exactly what this transaction will deliver.”
Michael Chu, Global Co-CEO of L Catterton said: “With its high quality portfolio, reputation for luxury, and commitment to delivering a distinctive experience to customers, Value Retail is well positioned for growth and continued success.
“We have deep experience investing in luxury retail, and we are eager to leverage our operational expertise and global network of established relationships to partner with Value Retail and propel the business forward.”
