Bloomberg News

Liberty Leads Property Stocks Down on Capital Raising

February 20, 2009

Liberty International Plc, the U.K.’s largest owner of shopping malls, led real estate stocks lower after saying it’s considering options for raising cash.

Liberty fell 9.3 percent, the most in four weeks. Land Securities Group Plc, the U.K.’s largest real estate investment trust, slumped to lowest in 16 years after yesterday saying it plans to raise 756 million pounds ($1.1 billion) by selling shares to existing investors.

“Liberty’s fall is in anticipation of a rights offer and some fears about who is going to underwrite it,” said Harm Meijer, an analyst at JPMorgan Chase & Co. in London, who has a “neutral” rating on the stock. “They need at least 400 million pounds to 500 million pounds and ideally more.”

Land Securities, British Land Co. and Hammerson Plc together plan to raise 2.1 billion pounds as property values tumble. Liberty, which releases its 2008 earnings on Feb. 26, is one of three companies to say since Feb. 18 they’re looking for ways to raise cash. The other two were Brixton Plc and Segro Plc.

Liberty fell 32.5 pence to 317.5 pence in London trading. Land Securities declined 7.5 percent, or 41.5 pence, to 515.5 pence. Hammerson dropped 6 percent, or 20.25 pence, to 319.75 pence.

The FTSE 350 Real Estate Index declined 6 percent to its lowest level in almost 16 years.

To contact the reporter on this story: Peter Woodifield in Edinburgh at pwoodifield@bloomberg.net.

To contact the editor responsible for this story: Alan Mirabella at amirabella@bloomberg.net.


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