Biggest investor calls in valuers to assess Woolworths' property

Ardeshir Naghshineh hopes to prove that the retailer is worth much more than its 4.1p share price
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The Independent Online

Ardeshir Naghshineh, Woolworths' largest shareholder with a 10 per cent stake in the high street retailer, has hired the property consultants, CB Richard Ellis (CBRE), to make an independent valuation of the company's property portfolio.

The Iranian property tycoon who chairs the Targetfollow Group, which owns London's Centrepoint building, has long claimed that Woolworths' property portfolio is worth much more than City stock market analysts claim. Based upon the retailer's closing share price of just 4.1p last week, the entire company is valued at less than £60m.

Woolworths last month sold off nine of its leases to Tesco for £9m. It currently owns leases and freeholds on around 800 stores across the UK.

Last month Woolworths parted company with its property director, Colin Carter, in a boardroom shake-up instigated by its new chief executive, Steve Johnson.

It is thought that Mr Johnson met with Mr Naghshineh last Thursday to discuss the recent appointment of the accountants Deloitte, made by Woolies' banking creditors, Burdale and GMAC, which are assessing the company's viability.

Sources close to Burdale and GMAC, which have collectively loaned Woolworths £385m, told The Independent on Sunday on Friday that the appointment of Deloitte didn't necessarily signal the end of Woolworths as a going concern.

"Deloitte hasn't been hired to wind the company up," said the source. "We really hope that the company prospers as a going concern but, of course, we have to look after our interests."

Deloitte's review of Woolies is being led by Neville Khan, who earlier this year presided over the receivership of Standard Chartered bank's collapsed structured investment vehicle Whistlejacket.

Meanwhile there are concerns that the collapse of Woolworths could leave thousands of users of its pension scheme high and dry.

The company's annual report released earlier in the year showed that the fund was in deficit to the tune of around £50m. Sources close to the group claim that the recent turmoil hitting financial markets means that the deficit is now nearer £100m. In September, Woolworths posted half-year losses of nearly £100m, prompting the collapse in the company's share price.

Around the same time Atradius and Euler Hermes, the UK's largest credit insurers, withdrew cover for firms supplying Woolworths over concerns that it could collapse.