Unibail-Rodamco-Westfield Completed The Disposal Of Its Stake In The Jumbo Shopping Centre

Unibail-Rodamco-Westfield (ASX: URW) owns, develops and manages premier retail asset in the most dynamic cities in Europe and the United States. On 1 March 2019, the company made an announcement stating that on 28 February, it has completed the disposal of its 34 percent interest in the Jumbo shopping centre for a price of €248.6 Million.

Following the release of this news, the share price of the company increased by 1.021% in the intraday trade as on 1 March 2019.

Jumbo is one of the leading shopping centres in Helsinki, Finland. The disposal of Jumbo will allow the company to focus more on its strategic assets in the Nordics which are having significant re-development and mixed-use opportunities. 

Earlier in December 2017, the company was aiming to dispose of €3 Billion of its assets in the next few years but later doubled the target to a total of €6 Billion. In 2018, the company disposed of around €2 Billion of its assets. After considering the disposal of Jumbo shopping centre for €248.6 Million, around €3.7 Bn of assets are still remaining which needs to be disposed of. It is expected that the disposals will increase the average portfolio quality and reduce leverage, and it is expected that this will have a short-term impact on the 2019 AREPS of around -90 cents.

On 1 March 2019, the company provided an update on the dividend distribution of chess depository Interests 20: 1. On these securities, the company has declared a distribution of EUR 0.270 per share which is having a record date of 28 March 2019 and Payment date of 12 April 2019.

The company recently announced successful placement of €1.5 Billion of bonds which includes a €750 Million bond with an 8-year maturity and a 1.0% fixed coupon and €750 Million bond with a 15 year maturity and a 1.75 percent fixed coupon. The net proceeds from the bonds will be utilized for general corporate purposes and will further extend the company’s debt maturity profile.

For 2018, the company reported strong results, with Adjusted Recurring Earnings per Stapled Share (AREPS) of €12.92 which is exceeding the guidance of €12.75 – €12.90 and is up by over 7.2% on pcp. The Gross Market Value (GMV) of the company’s assets as at December 31, 2018, amounted to €65.2 Billion on a proportionate basis, up by more than 49.9% on pcp, mainly due to the acquisition of Westfield.

The company’s most important strategic objectives over the next few years is to decrease leverage and review its various development projects to optimize capital and returns. Further, the company is also aiming to join with strategic capital partners on selected development projects.

Meanwhile, in the last six months, the share price of the company decreased by 23.97% as on 28 February 2019. URW’s shares traded at $11.375 with a market capitalization of circa $31.14 billion as on 1 March 2019. It has a 52 Weeks high of $15.170 and $10.650.


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