Will shareholders scupper Hammerson deal with Intu?

One of Britain's richest men will be breathing a sigh of relief that the French would-be bidder for shopping malls giant Hammerson (Frankfurt: 876140 - news) has walked away.

That man is John Whittaker, the mogul who built the Trafford shopping centre in Greater Manchester and whose Peel Holdings empire redeveloped Salford Quays on the site of the old Manchester Docks into MediaCityUK, home to ITV Studios and numerous BBC outlets.

Mr Whittaker, whose net worth is put at £2.3bn, was thought to be one of the prime movers in Hammerson's proposed £3.4bn takeover of rival Intu (Swiss: OXIGTU.SW - news) - in which he has a 27.2% stake.

That deal will bring together North London's Brent Cross, Birmingham's Bullring and Bristol's Cabot Circus with Intu assets such as the Lakeside in Thurrock, Essex; the Metro Centre in Gateshead and, of course, the Trafford Centre.

But it was thrown into jeopardy when it emerged last month that the French malls operator Klepierre (LSE: 0F4I.L - news) had made a £4.9bn approach to Hammerson .

That was tweaked to £5.06bn earlier this week but was batted away by David Tyler, Hammerson's chairman, on the grounds that it undervalued the business.

The French have now flounced off , accusing Mr Tyler of failing to provide any "meaningful engagement", sending Hammerson shares lower.

So, does that mean Hammerson can now press ahead with the Intu deal?

Not necessarily.

A fair few Hammerson shareholders are understood to be less than impressed with the acquisition of Intu.

Their criticisms hinge on the fact that, during the last few years, the Hammerson chief executive, David Atkins, has taken the company out of office developments and built it into a focused business specialising in shopping centres, retail parks and premium outlets in prime destinations not just in the UK, but in key European markets such as France, Germany and Spain.

The Intu deal, by contrast, is seen as doubling-down on UK shopping centres at a time when traditional bricks-and-mortar retail is under siege as shoppers increasingly drift online.

Some critics of the deal also argue that Intu's assets have suffered from under-investment, are not as attractive as those Hammerson owns, and that therefore the quality of the latter's property portfolio will be diluted by the deal.

For his part, Mr Atkins has insisted all along that the majority of Hammerson's shareholders support the deal, which would leave the enlarged company with a pan-European property portfolio worth some £21bn and see it leapfrog Land Securities (LSE: LAND.L - news) to become the UK's biggest listed property company.

He says he has had one-on-one meetings with three-quarters of investors and that they have all been supportive - although one of the company's 20 largest shareholders told The Times earlier this week that it should accept the Klepierre offer and walk away from the Hammerson deal.

Yet Klepierre's decision to walk away suggests that by no means do all of Hammerson's shareholders support it. The French company had lobbied a lot of them in recent days and, rumour has it, was told to come back with a better offer.

Even (Taiwan OTC: 6436.TWO - news) the sweetened 635p-a-share offer tabled by Klepierre earlier this week represented a significant discount to Hammerson's 790p net asset value (NAV) per share - basically the sum of money shareholders would receive, per share, if all of the company's assets were sold off, its debts repaid and the proceeds distributed to investors.

Klepierre clearly concluded that, given the uncertainty surrounding UK retail at present, it did not wish to.

It now falls to Mr Atkins and his colleagues - who, after the company's latest results in February, snapped up £250,000 worth of shares between them to show how under-valued they feel them - to get the Intu deal over the line.