Business & Money | Friday 30 November, 2018 2:00 am |

A consortium including Saudi Arabia’s Olayan Group has scrapped plans for a £2.9 billion bid for a UK shopping center owner.
Shares in mall owner Intu collapsed on Thursday when the would be suitors, that also included Peel Group and Canadian property firm Brookfield, said that “macroeconomic uncertainty and potential market volatility” meant that they could not submit an offer.
Intu shares dropped 35 percent to trade at almost half the 210.4 pence level of the planned bid. It is the second major blow faced by the company after rival Hammerson also dropped a £3.4 billion deal to acquire the company in April.
“Given the uncertainty around current macroeconomic conditions and the potential near-term volatility across markets, the consortium is not able to proceed with an offer within a timeframe which is manageable within the confines of the code timetable,” the consortium said in a statement.
While the consortium did not elaborate on the specific uncertainty that dissuaded its members to pursue the deal, it comes at a time of immense political and economic upheaval in Britain driven by uncertainty surrounding the country’s planned departure from the EU next March.
At the same time, big high street retailers are being forced under as more people shop online, which is having a knock-on effect among mall owners dealing with vacant units and downward pressure on rents.
PwC estimates that some 14 shops are closing every day in the UK.
Mike Ashley, the Sports Direct tycoon who recently took over House of Fraser, revealed he planned to shut four Fraser department stores in Intu shopping centers.
David Fischel, Intu’s chief executive, said that Brexit worries had weighed on the deal in an interview with Reuters.
“The escalation in the news around Brexit and all the potential ramifications has obviously ramped up a lot in the last couple of weeks and has made it a very hard climate to make a big investment decision,” he said.
The UK government was forced to admit on Wednesday that Britain would be economically worse off in any scenario outside the EU.
Earlier the Bank of England warned that in its worse case scenario of a “disorderly” exit, the pound could fall by 25 percent, inflation would spike to 6.5 percent and house prices would tumble by 30 percent.
Peel and Olayan hold about 29.9 percent of the share capital of Intu while Brookfield has no interests in the shopping center owner.