Wembley discusses stadium complex rebuild

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WEMBLEY, the leisure group that last month sold Wembley Stadium to the Football Association so it can be rebuilt, has held talks with property groups about redeveloping the complex around the stadium.

"When you build a new stadium it always acts like a magnet," Nigel Potter, Wembley's chief executive, said yesterday. "We have had some discussions with property companies about the possibilities for the site."

Although Wembley no longer owns the famous twin towers, it still controls much of the land around the stadium as well as the Wembley Arena and conference centre. Analysts believe Wembley is likely to form a joint venture with a property developer to redevelop the site, which could attract retailers and other leisure operators.

"When you are sitting on 40 acres of land in that location you are in a good position to negotiate with developers," said Peter Joseph, an analyst with stockbrokers Peel Hunt.

The news emerged as Wembley reported a three-fold jump in pre-tax profits for the year to last December to pounds 35.2m, boosted by an pounds 8.4m gain as a result of property revaluations. Underlying pre-tax profits rose by 8 per cent to pounds 26.8m.

Claes Hultman, the chairman, said the company was planning to return "a substantial proportion" of the proceeds of the stadium sale to shareholders. It is looking to minimise the tax liabilities for shareholders and expects to make an announcement in the next few months. Wembley received pounds 103m from the sale.

After paying tax and settling a liability in the US, the group will be left with about pounds 60m. However, Mr Potter said the group had decided against a large acquisition.

According to analysts, the stadium sale has highlighted Wembley's value. Mr Joseph calculates that the group's assets and businesses have a combined value of about pounds 250m - equivalent to 444p a share. Yesterday, Wembley shares rose 10p to 340.5p.