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Breaking Up Intu To Cost £100M

Courtesy of Intu
Intu Derby

Administrators to collapsed shopping centre giant Intu have revealed that the process of breaking the company up will cost about £100M.

In a report to creditors, partners at KPMG who were appointed in June to manage the collapsed shopping centre giant Intu said that the administration of the company, which collapsed with more than £4.5B of debt secured against its assets, is highly complex, involving the migration of more than 2,000 staff to new companies managing individual shopping centres.

It said staff costs during the administration process would be about £21M, and service charge on the properties Intu owned would be about £39M, the two single largest costs.

KPMG’s fee is estimated at £16M, with a team of 42 from the firm working on the administration. In its report, KPMG also lists £3.5M in external adviser fees, £4M in legal fees and £1.3M in advertising and public relations fees.

In the report, the administrators outline how some of the assets are likely to be taken over by lenders because they are worth less than the value of the debt secured against them. They said they are working with lenders to the company to determine which assets will be sold at what point. They said they are retaining the overall corporate structure in case someone wants to buy the whole company but the likelihood is that all of Intu’s assets will be sold piecemeal over time.

The first assets to go on the block include a 50% stake in the Xanadu shopping centre in Madrid, where CBRE has been appointed to market Intu’s share. It bought the centre for €530M in 2017.

Elsewhere CBRE and PJT Partners have been appointed to sell the Trafford Centre in Manchester. Widely regarded as Intu’s best asset, it was last publicly valued at £1.7B.

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Related Topics: Intu , KPMG
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