Westfield responds to raising new equity “market rumours”

Westfield Stratford
Westfield Stratford, June 2020. Image: ©TheIndustry.fashion

Property company and shopping centre giant Unibail-Rodamco-Westfield (URW), the parent company of Westfield, has issued a statement in response to “market rumours” that it is considering raising new equity.

As reported by Bloomberg on Friday 14 August, 2020, URW has been “in early discussions” about raising $3.5 billion (£2.67billion) of fresh equity as the retail industry reels from the fallout from the coronavirus pandemic, with footfall in shopping centres dramatically down.

The URW statement reads: “As detailed in its H1-2020 results communication, as at 30 June, 2020, URW had €12.7billion (£11.5billion) of cash and undrawn credit facilities at its disposal.

URW has taken a number of steps in response to the COVID-19 pandemic to strengthen its liquidity and balance sheet, including the cancellation of the second dividend instalment, deferring non-essential capital expenditures, a further reduction of the development pipeline and the completion of the disposal of five French shopping centres.”

At the end of July, 2020, the company, which operates two Westfield shopping centres in the UK, Westfield London in White City and Westfield Stratford, recorded a 27.5% drop in net revenue income during the half-year period.

The statement continues: “As previously communicated, deleveraging is a priority for URW, starting with asset disposals as evidenced by its intention to sell €4billion (£3.61billion) of assets in the next couple of years, on top of the €4.8billion (£4.34billion) of disposals the group completed since June 30, 2018.

“In addition, the supervisory board and management board continue to weigh the merits of all potential strategies to strengthen URW’s financial profile in line with their respective fiduciary duties. However, no decision has been made yet on any of the available additional deleveraging options. Announcements on relevant decisions, if any, will be made as appropriate.

Reporting on the early-stage fundraising talks, Bloomberg said on Friday that shares of URW were “down 6.6% at the close on Friday in Amsterdam, the biggest drop in more than two weeks.”