Intu Properties confirms it's looking to raise cash

Shopping centre owner Intu Properties confirmed on Monday that it is looking to raise extra cash to bolster its balance sheet.

Responding to press speculation over the weekend, the company said it continues to make progress in its strategy to fix the balance sheet.

"Consistent with previous announcements, this now includes targeting an equity raise alongside its full year results at the end of February. The company is currently engaged in constructive discussions with both shareholders and potential new investors on the proposed equity raise," it said.

The statement followed an article in the Sunday Times suggesting that Intu was looking to raise £1bn in emergency funding.

Intu did not comment on the size of the equity raise.

Chief executive Matthew Roberts said: "We are making good progress with fixing the balance sheet, our number one priority, and are confident we have the right strategy in place to enable us to prosper as we see continued polarisation between the best destinations and the rest."

Intu said it had delivered a "robust" operational performance for 2019, ending the year with a busy Christmas trading period. Total footfall last year was 0.3% higher than 2018 and flat in the UK, which it said significantly outperformed the Springboard footfall monitor for shopping centres.

Occupancy was stable at 95% and to date, 97% of rent has been collected for the first quarter of 2020, it said.

At 0810 GMT, the shares were down 7.3% at 21.20p.

RBC Capital Markets said:"The news that Intu is targeting an equity raise as early as next month is not a big surprise given management’s previous comments. The £1bn size mentioned in the press articles would significantly reduce Intu’s financial gearing, but would likely leave it above management’s target range factoring in the negative property revaluations we forecast for 2H2019."