Shares digital

Swiss retail and property company Jelmoli has begun arbitration proceedings against a consortium including Delek Global Real Estate (DGRE:AIM), following its failed acquisition of a property portfolio owned by Jelmoli.

The consortium had originally agreed to purchase a portfolio comprising 88 investment properties for CHF 3.4 billion back in July. Delek Global was expected to acquire a 33% stake in the portfolio, which would have been the largest property portfolio ever sold in Switzerland.

However, due to the change in the global commercial property market and continuing market uncertainty, the consortium decided not to complete the acquisition, pulling out in October, just two days before the takeover was due to be completed.

Legal action is also being taken against Delek Belron International (Delek Global’s parent company), Blenheim Properties Group and Empario.

Jelmoli is seeking the completion of the transaction and compensation resulting from the breach of the agreement. However, the shares of Delek Global rose 3% to 106.5p.

Shares says: Delek Global still has a promising portfolio and the stock is worth holding on to.