Unibaill-Rodamaco buys Westfield for $24.7bn

Westfield the developer behind popular shopping centres in London and New York, has confirmed they will be acquired by French property company Unibail-Rodamco in a $24.7bn deal that will create the world’s second-biggest mall owner by the market value of $72m with 104 properties. Sir Frank Lowy (87), the Australian billionaire who founded the business in Sydney suburb in the 1960s and turned into a global shopping centre. The deal gets Unibail-Rodamco, Europe’s largest property company, access into the US and UK where Westfield has assets in prime locations, such as Shepherd’s Bush and Stratford in London, World Trade Centre in New York and Century City in Los Angeles. According to Christophe Cuvillier, CEO of Unibail-Rodamco, the deal would create a new group under the Westfield brand that owns 56 flagship shopping destinations in 13 different countries and 27 capital cities.

Westfield is established in the wealthiest cities in the US with very strong demographic fundamentals.

Unibail-Rodamco would pay Westfield shareholders the equivalent of $7.55 per security in a mix of cash and shares – an 18 per cent premium to Monday’s closing price. The US has been badly hit as about 9000 stores with 150m² of retailing space would close in the US in 2017, as the fall share prices of property companies. Uk’s Hammerson bought Intu for £3.2bn while Canada’s Brookfield is trying to buy out the remainder of real estate group GGP for $15bn.

Westfield is a strong brand in a weak industry and owns 35 shopping centres across UK and US and is also developing a mall in Milan. The Australian and New Zealand malls have bee3n renamed as ASX-listed Scentre Group. Online retailers are  already fighting back against experimental shopping, luxury goods including hand delivery or return purchases.