RIO DE JANEIRO, BRAZIL – BR Malls reported yesterday that it has completed the sale of seven shopping malls to a real estate fund managed by BTG Pactual for R$696 million (US$174 million).
According to the company, the sale is part of a reorganization plan intended to eliminate assets which are not essential to the business. In the wake of comments on the deal, the company’s stock rose by 5.7 percent this week.
“The assets sold are solid shopping malls, but inside a larger portfolio, they were less privileged and may get more investments and attention by the new buyer,” said BR Malls in a statement, stressing that the entire amount collected will be distributed to shareholders as dividends and interest-over-capital.
The company further stated that it intends to sell two more shopping malls in the coming quarters — São Luís (in the capital of Maranhão State) and Via Brasil (in Rio de Janeiro). The sold malls are Ilha Plaza, Casa & Gourmet, Shopping Plaza Macaé, Londrina Norte Shopping, Osasco Plaza Shopping, Shopping Contagem, and Capim Dourado, located in the cities of Rio de Janeiro, Macaé (Rio de Janeiro), Londrina (Paraná), Osasco (São Paulo), Contagem (Minas Gerais), and Palmas (Tocantins), respectively.
The company said that it would keep a total of 29 malls after this restructuring phase. “We will maintain our scale and liquidity, given that the sold shopping malls account for less than ten percent of the company’s revenue.”
BR Malls stated that it intends to undertake a program to redesign the projects in its portfolio. The company also said it plans to add new services to these shopping malls.
The sale proceeds may be increased by an additional payment based on asset performance. The amount will be determined by December. Should the targets be met, the company estimates that it will earn up to another R$22.4 million.