Merger with brMalls (BRML3) will create a stronger company to face the crisis, says director of Aliansce (ALSO3)

Merger with brMalls (BRML3) will create a stronger company to face the crisis, says director of Aliansce (ALSO3)

The company that will emerge from the business combination between Aliansce Sonae (ALSO3) and brMalls (BRML3) will have more strength to face moments of crisis, said Daniella Guanabaradirector of strategy and investor relations at alliancesin an interview with the Money Times.

Asked about the risks that the Fusion can bring to the business, given the increased complexity of operations and the size of the combined company, the director of IR highlighted that the market experience of both companies should prepare them for sudden changes in the Brazilian macroeconomic scenario.

“We are in the market for malls for many years, both brMalls as for alliances. We’ve been through other crises,” said Guanabara.

The executive also recalled that the malls are in a strong recovery rhythm, both from the point of view of sales how much of rentsafter facing the “biggest crisis in the sector”, when the pandemic of coronavirus forced establishments to close their doors for a few months.

According to Guanabara, when two companies the size of brMalls and gives alliances and on a recovery path, the combined company should actually be born stronger.

“The combined company gets bigger, gets stronger to face this crisis”, he commented.

industry giant

After approval in assemblies, the merger proposal will be evaluated by the Administrative Council for Economic Defense (Where).

Market analysts and even the companies involved in the transaction are certain that there will be a need for divestments, as the business combination will create the largest shopping center operator in Brazil, valued at R$ 12 billion and with a portfolio comprising 69 assets that add about 13 thousand stores.

Guanabara pointed out, however, that the portfolios of Aliansce and brMalls have little overlap and, probably, the antitrust agency should ask the companies to dispose of few assets, with low results in the consolidated company.

“We’re talking about three or four cities where we might have to sell a mall. It’s not much, close to the consolidated company”, said the executive.

In addition, she highlighted that the shopping mall market in Brazil is still very fragmented.

“When adding the Aliansce Sonae portfolio to the brMalls portfolio, this gives 14% of the shopping mall area in Brazil. It’s not a very high level of concentration”, added Guanabara.

synergies

Guanabara said that the intention to propose a business combination with brMalls already existed in 2017. However, Aliansce was starting the process of incorporating Sonae.

Now, taking advantage of the devaluation of actions Due to the worsening economic crisis, the alliances thought it opportune to enter a proposal to merge its business with the operations of brMalls.

“When we see that the shares are undervalued, it is a way to make an acquisition with exchanges of shares, involving less money and more shares. Given that we had this advantage of both being publicly traded, it was a good time to do it”, explained the IR director.

Guanabara believes that the complementarity of the portfolios will not only bring gains in capillarity, but will also create the operation with the best business proposal for retailers and consumers.

THE alliances projects synergies of up to R$ 210 million per year in this transaction. With brMalls, the company hopes to leverage its strategy “figital” (physical plus digital), which is already put into practice via Box Delivery and e-commerce established in some malls.

Source: Money Times

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