The controversial split of shopping centre giant Westfield has been an early winner, delivering shareholders a $4.5 billion gain in less than two months.
Chairman and founder Frank Lowy is cheering the run up in the respective share prices of Westfield Corporation and Scentre Group since the restructure.
"As of today, with the new entities' combined market capitalisation of approximately $35 billion, the restructure has created $4.5 billion of value for the shareholders of the former Westfield Group and Westfield Retail Trust," he said.
That $4.5 billion gain is equivalent to nearly three times the entire market value of department store Myer.
Westfield Group and its associated passive property trust, WRT, were restructured at the end of June to split the company's Australian and New Zealand operations from its growing international business.
Under the new structure, Westfield Corporation owns the international division, which includes flagship centres like Westfield London, while the Australasian shopping centres are controlled by the new company, Scentre.
Since the split, Westfield Corp shares have climbed from $6.70 to $7.61 on Wednesday, while Scentre shares have climbed from as low as $3.08 to $3.45.
According to Peter Esho, managing partner at wealth manager 100 Doors, a divided Westfield is more attractive to investors than a united one.
Westfield has little room left to grow in Australia but its centres offer a relatively safe return, in contrast to the higher risks and rewards of the overseas business, he said.
"Effectively they are two different businesses going in two different directions," Mr Esho said.
"They have a different risk profile so (combined) they may or may not have been adequate for a particular type of investor."
The restructure came close to failure due to opposition from some WRT shareholders, who complained the move would leave them with a higher risk investment than they'd bought into.
WRT abandoned a planned investor vote on the restructure after a count of proxies revealed it was set to fail, but narrowly got the move across the line a few weeks later after lobbying institutional shareholders.
Mr Lowy said both companies had performed well since the restructure.
Westfield Corporation on Wednesday said it had achieved a 5.3 per cent gain in comparable net operating income from its international shopping centres during the six months to June 30.
Specialty retail sales from the shopping centres were up 4.2 per cent over the period.
The company has an $11.6 billion development pipeline in the US in Europe, including Westfield World Trade Centre and a flagship centre in Milan.
Westfield expects to pay a distribution of 12.3 cents per share for the six months to December 31.
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