Stake in Bicester Village sold for £1.5bn

A stake in the designer retail outlet operator Value Retail has been bought by L Catterton, backed by LVMH

Shopping centre giant Hammerson has sold off its stake in the owner of Bicester Village in a deal worth £1.5bn.

Hammerson shares lifted on Monday after it announced the sale of its Value Retail business to private equity firm L Catterton, backed by LVMH (Louis Vuitton Moet Hennessy).

Hammerson said the sale of the Oxfordshire designer retail outlet operator Value Retail would generate about £600 million in cash proceeds.

It told investors it would be able to reduce its debts, invest in other assets and hand up to £140m to shareholders through a buyback.

The firm, which also owns Birmingham's Bullring, said the deal would also help support its strategy to focus on urban retail real estate.

Hammerson owned almost 40% of Value Retail

Michael Chu, global co-chief executive of L Catterton, said: "With its high-quality portfolio, reputation for luxury, and commitment to delivering a distinctive experience to customers, Value Retail is well positioned for growth and continued success.

"We have deep experience investing in luxury retail, and we are eager to leverage our operational expertise and global network of established relationships to partner with Value Retail and propel the business forward."

Hammerson owned almost 40% of the business, which owns nine luxury shopping destinations, including sites near Barcelona, Paris and Milan.

Rita-Rose Gagne, chief executive officer of Hammerson, said: "This is a transformational deal for Hammerson, generating cash proceeds of around £600m whilst removing an overweight, low-yielding and minority stake, and positioning us for accelerated growth and value creation."