14th Oct 2014 12:52
LONDON (Alliance News) - Royal Mail PLC Tuesday said it has exchanged contracts on the sale of its former Paddington mail centre in London.
The FTSE 100-listed company said it will sell the site to Great Western Developments Ltd, a subsidiary of Singapore-based hotels and real estate company Hotel Properties Ltd, for GBP111 million in cash.
Under the terms of the deal, Royal Mail will receive a further GBP20 million should planning permission be granted for a mixed-use scheme on the site. In addition, Royal Mail will additionally get a50% of any net sale proceeds above the GBP111 million purchase price if the site is sold within the first year, or 25% if sold in the second year.
"Royal Mail continues to seek to optimise value from sites no longer required for operational use and will consider all options as to the manner in which this is achieved," said Royal Mail Group Property Director Martin Gafsen.
Royal Mail shares were up 1.4% to 399.60 pence Tuesday afternoon.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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