Intu Properties

Intu Properties plc was a British property investment and shopping-centre management company whose principal business was the ownership, part-ownership, development and operation of large retail centres. Before its collapse, the group was one of the most prominent shopping-centre landlords in the United Kingdom and also held interests in Spanish retail assets. Its consumer-facing Intu identity was used across a portfolio of major centres, while the corporate group retained a structure rooted in several earlier businesses and name changes. The company originated in 1980 as Transatlantic Insurance Holdings plc, established by Sir Donald Gordon as an offshoot of Liberty Life Association of Africa. It initially developed through investment in life-assurance businesses. During the early 1990s it disposed of its remaining life-assurance interests and merged with Capital & Counties, a shopping-centre developer and investor. That transaction moved the business toward property and helped secure a London Stock Exchange listing. The group adopted the Liberty International name in 1996. In 2010, Liberty International demerged its Capital & Counties Properties business into a separate company. The remaining group was renamed Capital Shopping Centres Group plc, commonly abbreviated as CSC, to emphasize its retail-property focus. CSC expanded its portfolio through acquisitions including the Trafford Centre in Manchester and a majority interest in Westfield Broadmarsh in Nottingham. In 2013 it adopted the Intu name and began rebranding many of its centres under the same identity. The rebrand introduced an orange-and-black visual system and a bird symbol, and was intended to create a recognizable consumer brand across otherwise separately named shopping destinations. Intu combined property ownership with centre management, leasing, redevelopment and customer-experience activities. Its portfolio included regional shopping centres such as Lakeside, intu Watford, intu Victoria Centre, intu Braehead, intu Derby, Merry Hill, the Trafford Centre and intu Milton Keynes. It also operated or held interests in Spanish centres, including Puerto Venecia, intu Asturias and intu Xanadú. The group sought to respond to online retail and changing shopping habits by launching an online shopping-centre service and bringing shopping-centre employees in-house from a facilities-management provider. The business expanded substantially during the 2010s, but its financial position became increasingly exposed to high leverage, declining high-street footfall and the difficulties of major retail tenants. A proposed £3.4 billion takeover by Hammerson was agreed in 2017 but was not completed after Hammerson recommended that shareholders reject it. A later consortium bid involving Peel Group, Olayan Group and Brookfield Property was withdrawn in 2018. Intu subsequently sold selected Spanish interests in an effort to generate liquidity. In March 2020, the company abandoned a proposed £1.3 billion emergency equity fundraising. It reported a £2 billion loss for 2019 and carried approximately £4.5 billion of debt, while the COVID-19 pandemic increased pressure as retailers delayed rent payments. Intu warned that it might breach debt covenants and require lender waivers. After restructuring discussions failed, the group entered administration on 26 June 2020. Several shopping centres were later transferred to or placed under the control of new ownership and management arrangements. The Intu corporate group therefore ceased operating as an independent listed property company, although some assets and centre brands continued under successor owners.

Intu's corporate history began in 1980, when Sir Donald Gordon established Transatlantic Insurance Holdings plc as an offshoot of Liberty Life Association of Africa. Gordon had founded Liberty Life in 1957, and the new listed vehicle initially developed as an investor in life-assurance businesses. During the 1980s, the group became a significant participant in the insurance sector. In 1991 it disposed of its remaining life-assurance interests, including a 29% holding in Sun Life, and began moving decisively toward property. A major turning point came in 1992, when the company merged with Capital & Counties, a shopping-centre developer and investor. The transaction gave the group a substantial retail-property platform and a London Stock Exchange listing. In 1996 the company changed its name to Liberty International. It also maintained interests outside the United Kingdom, including a Californian subsidiary known as Capital and Counties USA. A substantial holding in that business was sold to Equity One in 2010; Equity One was subsequently acquired by Regency Centers Corporation. In May 2010, Liberty International demerged Capital & Counties Properties as an independent business. The remaining company adopted the name Capital Shopping Centres Group plc, or CSC, reflecting its concentration on shopping-centre investment and management. CSC pursued a series of acquisitions. In 2011 it purchased the Trafford Centre from The Peel Group and offered Peel chairman John Whittaker a 20% interest in CSC as part of the transaction. Whittaker continued acquiring shares and became the company's largest shareholder in 2012, with a reported 24.63% stake. CSC also acquired Westfield Group's 75% interest in Westfield Broadmarsh in Nottingham in November 2011. The company announced a further identity change in January 2013. It would become Intu, and twelve shopping centres would receive names incorporating the new brand. The corporate name change took effect on 18 February 2013, while the centre rebranding began in May. The orange-and-black identity and bird emblem were intended to create a consistent, consumer-oriented presence across the portfolio. The company also promoted a digital retail proposition described as the United Kingdom's first online shopping centre and brought shopping-centre staff in-house, replacing an arrangement under which they had been employed by Bilfinger Europa. Intu continued to expand during the middle of the decade. It agreed to acquire Midsummer Place in Milton Keynes from Legal & General for £250.5 million in February 2013. In 2014 it announced an £867.8 million property deal involving Merry Hill, Westfield Derby and Sprucefield Park. The group operated a mixture of wholly owned and part-owned regional centres in the United Kingdom, alongside investments in Spain. Its business model depended on rental income, asset values, tenant demand, centre footfall and the ability to finance redevelopment. The retail-property environment became increasingly difficult. Online shopping, changing consumer behaviour, declining high-street footfall and the failures or financial distress of important retailers placed pressure on rents and valuations. Intu agreed to a proposed £3.4 billion takeover by Hammerson in December 2017, but Hammerson later recommended that shareholders reject the offer. A second proposal, valued at about £2.8 billion and backed by Peel Group, Olayan Group and Brookfield Property, was withdrawn in November 2018 after due diligence. Intu sought to strengthen liquidity by considering disposals. In late 2019 it discussed the sale of three Spanish assets and sold its interest in Puerto Venecia for €237.7 million, with reported net proceeds of about €115 million. Its Oviedo asset was sold the following month for approximately £85 million in proceeds as reported in the reference material. These transactions did not resolve the group's broader leverage problem. In March 2020, Intu abandoned a planned £1.3 billion emergency cash call because investor support was insufficient. The company had approximately £4.5 billion of debt and reported a £2 billion loss for 2019. The COVID-19 pandemic intensified the crisis as retailers delayed rent payments. Intu warned that it would need lender waivers and might breach debt covenants in July. By June it said that shopping centres could face closure if restructuring discussions failed and had appointed KPMG as a contingency administrator. On 26 June 2020 Intu entered administration. The administration led to asset-level restructuring rather than a single continuing Intu group. In August 2020, Intu SGS, a subsidiary and holding vehicle for four centres, received funding to take full control of them. Global Mutual became asset manager and Savills property manager, with the arrangement completed in October. Transfers of Intu Derby, Merry Hill and Milton Keynes to new owners were confirmed in September, and Chapelfield was also announced as moving to new ownership. The listed Intu corporate business consequently ceased to operate as an independent company, while several former Intu properties continued under successor ownership and management.

1. 2020Administration

   Intu enters administration on 26 June after an emergency fundraising fails and restructuring talks with lenders do not produce a solution.

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2. 2019Spanish asset disposals

   Intu sells its interest in Puerto Venecia and later sells its Oviedo asset as part of efforts to raise liquidity.

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3. 2017Proposed Hammerson takeover

   Intu agrees to a proposed £3.4 billion acquisition by Hammerson, subject to approval.

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4. 2014Major United Kingdom portfolio expansion

   Intu announces the acquisition of Merry Hill, Westfield Derby and Sprucefield Park through an £867.8 million property transaction.

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5. 2013Intu identity launched

   The company adopts the Intu name and begins rebranding twelve shopping centres.

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6. 2011Trafford Centre acquisition

   CSC purchases the Trafford Centre from The Peel Group.

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7. 2011Westfield Broadmarsh interest acquired

   CSC purchases Westfield Group's 75% stake in Westfield Broadmarsh in Nottingham.

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8. 2010Capital Shopping Centres Group is formed

   After demerging Capital & Counties Properties, the remaining company adopts the Capital Shopping Centres Group name.

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9. 1996Company becomes Liberty International

   The group changes its corporate name to Liberty International.

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10. 1992Merger with Capital & Counties

    The merger shifts the company toward shopping-centre development and investment and secures a London Stock Exchange listing.

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11. 1991Remaining life-assurance interests are divested

    The group sells its remaining life-assurance interests, including a 29% holding in Sun Life.

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12. 1980Transatlantic Insurance Holdings is established

    Sir Donald Gordon establishes the company as an offshoot of Liberty Life Association of Africa.

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A large-scale shopping-centre owner and operator positioned its properties as regional retail, leisure and customer-experience destinations rather than merely conventional commercial real estate. The Intu identity was designed to unify a geographically diverse portfolio under a consumer-facing brand.

• Shopping-centre ownership and investmentCommercial real estate

  Intu's principal offering was ownership or part-ownership of large regional shopping centres. The group earned rental income and sought to increase asset value through tenant mix, leasing, redevelopment and improvements to the retail and leisure environment. Its portfolio included major United Kingdom destinations such as the Trafford Centre, Lakeside, Merry Hill and intu Derby, as well as Spanish assets.

• Shopping-centre managementProperty management

  The company managed day-to-day operations for its centres, including customer services, facilities coordination, marketing, tenant relationships and the presentation of common areas. Intu also brought centre employees in-house during its 2013 transformation, replacing a previous employment arrangement involving Bilfinger Europa.

• Intu online shopping centreDigital retail2013

  As part of its response to online retail and changing shopping habits, Intu launched a digital shopping-centre proposition. The service was presented as a way to extend the physical-centre brand into online retail and connect customers with centre-based shopping activity.

• Shopping-centre development and redevelopmentReal-estate development

  Intu used development and redevelopment projects to maintain the competitiveness of large retail destinations. These activities included expanding or modernizing centres, improving leisure and dining components, and managing the tenant and visitor experience. The approach depended on access to capital and sustained retailer demand.

• 2013Intu brand launch and centre rebranding

  United Kingdom

  The company introduced a unified orange-and-black Intu identity, including a bird emblem, and applied the name to twelve shopping centres. The programme was intended to make a portfolio of separately named properties more recognizable to consumers.

  Outcome. Most of the group's centres operated under the Intu identity for the remainder of the corporate group's independent life.

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• 2013Online shopping-centre initiative

  United Kingdom

  Intu launched an online shopping-centre proposition as part of a broader effort to respond to digital commerce and changing customer behaviour.

  Outcome. The initiative formed part of Intu's digital and customer-experience strategy, although the corporate group later entered administration.

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• 2020Emergency fundraising abandonedStrategy

  Intu faced approximately £4.5 billion of debt, a reported £2 billion loss for 2019 and increasing rent-payment delays during the COVID-19 pandemic.

  What changed. The company abandoned a proposed £1.3 billion emergency cash call after failing to secure sufficient investor support.

  Aftermath. Intu warned that it might breach debt covenants, entered restructuring discussions with lenders and ultimately went into administration.

  Emergency fundraising sought. £1.3 billion proposed cash call (March 2020)

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• 2020Entry into administrationOther

  Restructuring negotiations failed as the company faced debt pressure, covenant risk and reduced rental receipts during the pandemic.

  What changed. Intu appointed KPMG as a contingency administrator and entered administration on 26 June.

  Aftermath. Its centres moved into asset-level ownership, funding and management arrangements involving new owners and firms including Global Mutual and Savills.

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• 2019Sale of Spanish assetsStrategy

  Intu needed to generate liquidity while facing pressure from debt, falling retail footfall and weaker tenant conditions.

  What changed. The company sold its interest in Puerto Venecia and later sold its Oviedo asset, following discussions about disposing of three Spanish shopping centres.

  Aftermath. The disposals produced cash proceeds but did not resolve the group's wider financing crisis.

  Puerto Venecia sale consideration. €237.7 million gross consideration; approximately €115 million reported net proceeds (December 2019)

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• 2018Consortium takeover bid withdrawnM&A

  After the Hammerson proposal failed, Intu remained a potential target amid pressure on shopping-centre valuations and retail-sector performance.

  What changed. Peel Group, Olayan Group and Brookfield Property launched a proposed £2.8 billion bid but withdrew it after due diligence.

  Aftermath. Intu remained independent and continued seeking portfolio and financing solutions.

  Proposed takeover value. £2.8 billion proposed bid (2018)

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• 2017Agreement to Hammerson takeoverM&A

  Consolidation was increasing among large United Kingdom retail-property owners, and Intu agreed to combine with Hammerson.

  What changed. The companies announced a proposed takeover valued at £3.4 billion, subject to shareholder approval.

  Aftermath. Hammerson later recommended that its shareholders reject the transaction, so the takeover did not proceed.

  Proposed takeover value. £3.4 billion proposed transaction (2017)

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• 2013Adoption of the Intu brandStrategy

  The company sought a consistent consumer identity across a portfolio of major shopping centres while retail behaviour was becoming more digital and experience-led.

  What changed. Capital Shopping Centres Group adopted the Intu name, introduced a new visual identity and rebranded twelve centres.

  Aftermath. The Intu name became the principal public-facing identity of the group and many of its properties.

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• 2010Demerger and repositioning as a shopping-centre groupStrategy

  The company had moved from life-assurance investment into property and decided to separate Capital & Counties Properties as an independent business.

  What changed. The group demerged Capital & Counties Properties and renamed the remaining company Capital Shopping Centres Group.

  Aftermath. The remaining business concentrated more explicitly on shopping-centre ownership and management.

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• 2020Intu abandons emergency cash call

  Intu abandoned a proposed £1.3 billion emergency fundraising after insufficient investor support. The decision came amid approximately £4.5 billion of debt and a reported £2 billion loss for 2019.

  BankruptcyOther
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• 2020Intu warns of covenant pressure during the COVID-19 pandemic

  The company warned that delayed rent payments by retailers could require lender waivers and lead to breaches of debt covenants.

  BankruptcyOther
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• 2020Intu enters administration

  After restructuring negotiations with lenders failed, Intu entered administration on 26 June 2020.

  Bankruptcy
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• 2020Successor arrangements established for major Intu centres

  Following administration, Intu SGS obtained funding to take control of four centres and appointed Global Mutual and Savills for asset and property management. Transfers of other centres, including Derby, Merry Hill and Milton Keynes, were also confirmed.

  M&ALeadership change
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• 2019Intu sells interests in Spanish shopping centres

  Intu entered discussions to sell interests in three Spanish centres and subsequently sold its stake in Puerto Venecia and its Oviedo asset, generating proceeds for the financially pressured group.

  M&A
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• 2018Hammerson recommends rejecting the proposed Intu takeover

  Hammerson recommended that its shareholders reject the proposed acquisition, preventing the previously announced transaction from proceeding.

  M&A
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• 2018Consortium withdraws £2.8 billion bid for Intu

  Peel Group, Olayan Group and Brookfield Property withdrew a proposed takeover offer after conducting due diligence.

  M&A
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• 2017Hammerson agrees proposed takeover of Intu

  Intu agreed to a proposed £3.4 billion takeover by property company Hammerson, subject to shareholder approval.

  M&A
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• 2014Intu expands through the Merry Hill and Westfield Derby transaction

  Intu announced a property transaction valued at £867.8 million involving the Merry Hill Shopping Centre, full ownership of Westfield Derby and Sprucefield Park in Northern Ireland.

  M&A
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• 2013Intu adopts the Intu name and begins shopping-centre rebrand

  Capital Shopping Centres Group announced a new Intu corporate and consumer identity and began renaming a number of its shopping centres under the Intu brand.

  CampaignOther
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• 2013Intu agrees to acquire Midsummer Place

  The company agreed to purchase the Milton Keynes shopping centre Midsummer Place from Legal & General for £250.5 million, with completion reported later that year.

  M&A
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1. Intu