Trafford Centre could shut and 17 shopping centres at risk with Intu on brink of administration

Trafford Centre owner Intu is on the brink of collapsing into administration, after failing to secure its future during crunch talks with lenders.

Friday, 26th June 2020, 9:38 am
Updated Friday, 26th June 2020, 9:39 am

The shopping centre owner, which also runs Lakeside in Essex, had been in a desperate scramble to agree a "standstill" on its current loan agreements.

On Friday the group said it was likely to appoint administrators, as it remained unable to agree the terms of such a deal with its creditors.

In a statement the group, which has until midnight on Friday to reach a deal, said "insufficient alignment and agreement has been achieved".

Sign up to our Business newsletter

Sign up to our Business newsletter

A shopper walks through a near-deserted Intu Trafford Centre shopping mall amidst the novel coronavirus COVID-19 pandemic (Photo by OLI SCARFF/AFP via Getty Images)

It added: "The board is therefore considering the position of Intu with a view to protecting the interests of its stakeholders.

"This is likely to involve the appointment of administrators. A further announcement will be made as soon as possible."

Earlier this week, Intu said it put administrators from KPMG on stand-by as it looked to secure a deal ahead of the midnight deadline on its current loan covenants.

The group has struggled under a £4.5 billion debt burden for the past year, but has been hammered by significantly lower rent payments from retail tenants since the coronavirus outbreak.

Intu employs about 3,000 staff across the UK, while a further 102,000 work for the shops within its shopping centres.

It warned on Tuesday that its malls may be forced to shut if it was unable to secure the standstill agreement.