UK shopping mall giant Intu says facing collapse

Intu announced that "insufficient alignment and agreement has been achieved" with its creditors. PHOTO: REUTERS

LONDON (AFP) - British shopping centre giant Intu, whose properties have been ravaged by the coronavirus lockdown, warned on Friday (June 26) that it was likely to collapse after talks failed to restructure its finances.

Intu, which owns giant shopping malls including MetroCentre and the Trafford Centre in northern England and Lakeside in the southeast, had been seeking to progress talks with creditors ahead of a midnight deadline.

Shopping centres were forced to close for three months after the government imposed a nationwide lockdown on March 23 in a bid to halt the Covid-19 outbreak. Restrictions began to be eased this month.

In a statement on Friday, Intu announced that "insufficient alignment and agreement has been achieved" with its creditors.

"The board is therefore considering the position of Intu with a view to protecting the interests of its stakeholders," it added.

"This is likely to involve the appointment of administrators. A further announcement will be made as soon as possible."

Administration is the process whereby a troubled company calls upon independent financial help in a bid to restructure the business, remain operational and to try to minimise job losses.

Intu had warned on Tuesday that some of its shopping centres "have reduced rent collections as a result of Covid-19".

KPMG has been put on stand-by in case the group enters administration, while there was also "a risk that centres may have to close for a period", Intu stated earlier in the week.

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