Intu, the struggling property company that owns popular shopping centers like Lakeside and Merry Hill, has made a major decision to abandon its plans for an equity raise. The company had been in discussions with shareholders and potential investors, aiming to secure between £1 billion and £1.5 billion. Unfortunately, the current uncertainty in equity and retail property markets has prevented Intu from acquiring the necessary funds.

As a result, Intu’s shares have taken a substantial hit, decreasing its overall market value. Nevertheless, the company has stated that it has received interest from various parties regarding alternative capital structures and asset disposals. Additionally, Intu will continue to explore the feasibility of an equity raise.

While this failure to raise funds is certainly a setback for Intu, it does not necessarily guarantee immediate radical change. However, action must be taken promptly to address the situation. The company’s upcoming results, scheduled for release on March 12, will shed more light on the matter. The trading update mentioned that despite challenges in the retail industry, Intu had a resilient operational performance in 2019. Footfall in its centers increased slightly, while its UK properties remained stagnant. Looking ahead to 2020, Intu expects a further decline in rental income, albeit at a slower pace than the previous year.

Overall, Intu still maintains optimism about its prospects and highlights the strong performance of the retailers in its centers, which surpasses the UK average. The company also emphasizes its strong pipeline of negotiations that will support occupancy in the future.

CEO Matthew Roberts expressed disappointment over the failure to raise equity, but he remains hopeful due to the emergence of alternative options during the process. Roberts believes that Intu’s portfolio of well-invested retail and leisure destinations, alongside its operational strength, will enable the company to overcome financial hurdles and secure long-term success.

In conclusion, Intu’s announcement underscores the difficulties it faces in addressing its substantial debt burden. As the retail industry continues to encounter challenges and evolve, companies like Intu will need to find innovative and adaptive solutions to remain viable. Only time will tell if Intu can successfully navigate these obstacles and secure its future.

Useful links:
1. Financial Times: Intu fails to secure funds, shares plunge
2. BBC News: Intu abandons equity raise plans