Presenter: Lindsay Williams Guest(s): David Fischel

Liberty International, third largest property group in the UK, concludes a deal that will see it acquiring a stake in two more prime UK shopping centres. With Liberty International chief executive David Fischel

LINDSAY WILLIAMS: Liberty International, with dual listings in London and Johannesburg, said today it had agreed to acquire from Prudential plc its entire unit holding in Jersey Unit Trusts - owning 50% of the Prudential’s overall interests in The Mall at Cribbs Causeway, Bristol, and associated properties, as well as the Manchester Arndale shopping centre. A lot of money - £653-million! An article in the Financial Times a few days ago was saying that the high street in the UK had its worst February for 13 years.

You are still, obviously, very confident about the retail sector of the UK?

DAVID FISCHEL: Yes. Shopping centres of the quality of the two we’ve acquired an interest in really come on the market very seldom in the UK.

Cribbs Causeway in Bristol is one of the very few regional out of town centres in the UK. In the case of Manchester Arndale - it is going through a major redevelopment right now, which will take it up to 1.4-million square feet, which will make it the UK’s largest city centre shopping centre. These are two great assets, and I think one can take a medium-term view on the likely success of these centres.

LINDSAY WILLIAMS: Are you already represented in these areas?

DAVID FISCHEL: We have a development in Cardiff that we are about to embark on, in Oxford - all on the west of England. Nothing in Manchester - so we are delighted to get a big presence there.

LINDSAY WILLIAMS: The shopping centres themselves - are they going to need upgrading?

DAVID FISCHEL: The Mall at Cribbs Causeway was only opened in 1999 - it’s a relatively new centre, so no work required there. It’s fully let, with John Lewis - the best department store in the UK - as the anchor tenant. In the case of Manchester - it is going through this big re-development that’s going to transform it.

LINDSAY WILLIAMS: It says in my introduction you are the UK’s third biggest property group - does this push you up the league?

DAVID FISCHEL: Well, this is a cash deal. We are not issuing any shares - so it doesn’t really change our relative ranking in market cap. In terms of total assets, though, it takes us up to £6-billion - of which £5-billion is in UK shopping centres. So it really does entrench our market position in the UK - in the top tier of the UK shopping centre industry.

LINDSAY WILLIAMS: The investors liked it - Liberty on the JSE today closing up 1.8%. Any more acquisitions in the pipeline?

DAVID FISCHEL: I suspect we’ll keep our chequebook in the drawer for a little bit - while we digest these two.

LINDSAY WILLIAMS: I suppose that’s fair enough - £653-million out of your account!