Capital & Counties is considering whether to break up its business, a decision that could result in its Covent Garden estate being listed as a separate entity.
Capco said that it was mulling a demerger of its prime £2.5bn shopping district from its large mixed-use development site in Earls Court. If the proposal goes ahead, the two London estates will be launched as separately listed companies with their own chief executives by the end of the year.
The property company said that the board regularly reviewed the structure of its business to ensure it is “maximising long-term value creation for shareholders”.
However, market sources said that Capco had effectively hoisted a big “for sale” sign above its Earls Court site and was hoping to flush out a buyer so it could focus on Covent Garden.
The FT reported that Mike Prew, analyst at investment bank Jefferies, said it was “difficult to see how this divorce could add any shareholder value”.
He added that Earls Court “could look distinctly overvalued” while hiving off Covent Garden could leave the development at Earls Court “poorly financed”.
