The UK's third biggest property group, Liberty International plc, has concluded a deal that will see it acquiring a stake in two additional prime UK shopping centres.

The company, which has dual listings in London and Johannesburg, said on Tuesday that it had acquired or agreed to acquire from Prudential plc its entire unitholding in Jersey unit trusts owning 50% of the Prudential group's overall interests in The Mall at Cribbs Causeway, Bristol and associated properties as well as the Manchester Arndale Shopping Centre and associated properties for an aggregate consideration of 653 million sterling based on market values as at December 31 2004.

"Liberty International will settle the consideration from its existing cash balances and committed bank facilities. Completion in the case of Manchester Arndale is expected shortly once final landlord approval is confirmed," it said.

Under the terms of the transaction, Prudential Property Investment Managers Limited (PruPIM) is to continue as asset manager for these properties on behalf of the joint owners, as well as for the completion of the 150 million rand Manchester Arndale extension which is currently underway and due to open in phases between October 2005 and the end of 2006.

The consideration takes into account Prudential incurring the costs of completion of the Northern Extension.

Furthermore, Prudential and Capital Shopping Centres (CSC), a subsidiary of Liberty International, will seek to develop future areas of co-operation, including accessing, where appropriate, the potential advantage from their combined scale in such areas as commercialisation and procurement; and by jointly investigating, where appropriate, future shopping centre investment, development and management opportunities.

David Fischel, Chief Executive of Liberty International, commented: "We are pleased to have entered into this transaction with Prudential and PruPIM which enables them to meet their objective of achieving greater diversification in their real estate holdings while also meeting Liberty International's strategic objective of investing in prime UK regional shopping centres and increasing the scale and geographic spread of our activities.

"We look forward to attractive returns from these significant interests in The Mall at Cribbs Causeway and Manchester Arndale, which are acknowledged as highly successful UK regional centres, enabling us to extend our long track record of profitable expansion. We also look forward to considerable mutual benefits from a close working relationship in the regional shopping centre industry between Liberty International, CSC, Prudential and PruPIM."

Martin Moore, Managing Director of PruPIM, commented: "We are delighted to have achieved our objective of introducing another partner into these two major shopping centre interests and look forward to working with Liberty International and CSC whose long term investment approach and management expertise make them an ideal joint owner of these prime regional shopping centre interests.

"Between CSC and Prudential we have a substantial level of ownership and presence in the UK's top 25 shopping centres."