Topland sells stake in Tesco property venture

LONDON (Reuters) - Private property firm Topland Group Holdings said on Friday it had sold its 50 percent stake in a 950 million pounds joint venture with the country's largest supermarket retailer, Tesco.

Topland, which is headed by property entrepreneur Sol Zakay, would not disclose the value of the sale but a source familiar with the matter said the deal was struck following a period of significant capital appreciation during which the value of the joint venture assets rose to around 950 million pounds from 675 million pounds in just over three years.

The joint venture portfolio comprises 33 food stores and two distribution units. The stake has been bought by Axial Investment Management, the company responsible for the investment of funds accrued by the Pearl Group.

Topland and Tesco set up the joint venture in April 2004. The company said it instigated the sale in order to boost cash reserves ahead of a planned reinvestment programme designed to exploit falling UK and European commercial property prices.

The assets are let to Tesco on 25-year leases subject to annual fixed increases.