Intu Plunged Into Bankruptcy

Intu Plunged Into Bankruptcy

over 3 years ago2 mins

Mentioned in story

Another quarter of widespread rent refusals plunged European real estate investment giant Intu into bankruptcy on Friday 📉

What does this mean?

Back in March, Intu – which owns numerous UK shopping landmarks – only received 30% of the quarterly rent it was owed as retail tenants suffered from shuttered stores. And last week it managed to get just 14% of the rent it was due for next quarter. That put Intu in a tough spot: it owed money itself to banks and bondholders and was unable to agree a revised payment plan. Entering “administration” hands control of the company to its lenders, who may now seek to recover some cash by way of a restructuring.

Daily Brief Image

Retail landlords may have further struggles in store. Swedish fashion giant H&M reported its first quarterly loss in more than a decade on Friday; like rival Inditex, it could soon start reducing its physical footprint. Microsoft, meanwhile, announced on Friday that it was closing all its stores 🚫

Why should I care?

Intu’s shares had already lost 95% of their value this year, and they fell another 50% on Friday before trading was suspended. With as much as 60% of British retail space reportedly owned by the public 🇬🇧 – albeit largely indirectly through pension investment pots – the professionals stewarding people’s money might see Intu’s collapse as a sign that they need to focus on industries less at risk of failing to pay out the all-important dividends retirees rely upon for income.

Amazon agreed last week to buy autonomous vehicle startup Zoox for $1.2 billion, perhaps planning to integrate Zoox’s technology into its expanding delivery network 🚚 In the not-so-distant future autonomous delivery may put even more pressure on malls: even cheaper transport of products to peoples’ homes makes them even less likely to bother shopping in person.

Daily Brief Image
Finimize

BECOME A SMARTER INVESTOR

All the daily investing news and insights you need in one subscription.

Disclaimer: These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment advisor.

/3 Your free quarterly content is about to expire. Uncover the biggest trends and opportunities. Subscribe now for 50%. Cancel anytime.

Finimize
© Finimize Ltd. 2023. 10328011. 280 Bishopsgate, London, EC2M 4AG