Unibail Rodamco Westfield: US acquisition option with high hurdle

Research evidence excerpt

Unibail Rodamco Westfield: US acquisition option with high hurdle

Deutsche Bank

Research

Rating Company Date

Buy Unibail Rodamco 10 June 2026

Company Update

Europe Westfield

France

Reuters Bloomberg Exchange Ticker Price at 9 Jun 2026 (EUR) 97.50

URW.PA URW FP PAR URW

Price Target (EUR) 110.00

Real Estate

ADR ISIN 52-week range (EUR) 106.55 - 79.56

UNRDY US9045871020

US acquisition option with high hurdle

Valuation & Risks

Thomas Rothaeusler

US acquisition option with high hurdle Research Analyst

URW has announced a conditional agreement to acquire the remaining 50% stake +49-69-910-43054

in Westfield UTC, a US flagship mall, from its JV partner J.P. Morgan for USD 705

Sheetal Jaimalani

million (representing 50% of the asset). The acquisition is to be funded through a Research Associate

combination of cash and up to 2.6 million new URW shares, which would represent

about 1.8% of its total share capital. This transaction prices the asset at a 5.8% net

initial yield, which appears attractive when considering the 5.2% average yield of

URW's US portfolio. The closing of the deal is conditional on URW's share price by

year-end, which, as we understand, requires a meaningful increase from current

levels. Assuming an equal cash and equity funding split, the transaction would

necessitate a URW share price increase of more than 15% from its current level.

According to URW, this transaction is fully consistent with its 2028 business plan

and is expected to be LTV and AREPS neutral, and marginally accretive to NAV,

based on the higher share price threshold considered as a closing condition.

Overall, while the deal looks attractive for URW, in our view, it presents a high

execution hurdle. Assuming it does not go through, what would be the options for

J.P.