The markets have been expecting British Land to securities assets for several weeks now in order to pay down some of its expensive corporate debt, but the choice of the Sainsbury's supermarkets as security came as a surprise. The £1.3 billion ($18.2 billion) shopping mall near Sheffield, Yorkshire, had been seen as a more likely target. However, the bond market has already demonstrated its appetite for Sainsbury's-backed paper, as last year the retailer successfully securitised two portfolios of its owner-occupier stores worth almost £700 million ($980 million).
British Land has created a UK-registered special purpose vehicle, Warretown Supermarkets Securitisations, to carry out the issue. The proceeds will then be lent on to British land. UBS Warburg will begin pre-marketing the bonds immediately, with the issue formally launched within the next four weeks.
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