Shares in shopping centre owner Hammerson (LON:HMSO) rose on Wednesday morning, after announcing it would be urging its shareholders to vote against the proposed merger with rival Intu.

The group made an all-share offer for Intu at the end of last year in a deal with £3.4 million. In a surprise statement this morning Hammerson, who own Birmingham’s Bullring centre, pulled out of the offer citing market weakness.

Giving a nod towards the spate of high street closures of late, it said that “whilst Hammerson has proven its portfolio is well positioned to weather the current environment, the equity market now perceives a heightened level of risk associated with the UK retail property sector as a whole”.

“It is also apparent from extensive engagement with shareholders, in particular in recent weeks, that there is a wide range of views on the merits of the Intu acquisition. As a result, the board of Hammerson has concluded that the heightened risks associated with the Intu acquisition outweigh the long-term rewards that can be expected in comparison to other strategic options open to the company”, it continued.

If shareholders do not approve the purchase when they meet the offer will lapse, equating Hammerson’s statement with a withdrawal of its initial offer.

Hammerson shares are currently trading up 2.71 percent at 507.00 on the news (0834GMT).