UK shopping centre owner Hammerson (LON:HMSO) made a £3.4 billion bid for smaller rival Intu (LON:INTU), a move already agreed by over half of Intu’s shareholders.

Hammerson, who owns several major UK shopping centres including the Bullring in Birmingham and London’s Brent Cross, made an offer of 253.9p per share for Intu, a 28 per cent premium on the group’s closing price on December 5.

Intu owns the Lakeside shopping centre in Essex and Manchester’s Trafford Centre and if the deal goes through, it will create the UK’s biggest property company, worth £21 billion.

Intu shares rose over 20 percent in early trading on Wednesday, with Hammerson shares down 3.5 percent.

Hammerson’s chief executive, David Atkins, said:

“This marks an exciting milestone in the history of Hammerson. Bringing together the high-quality portfolios of both companies establishes Hammerson as a larger, leading European retail Reit, enhances shareholder returns and supports opportunities for long-term growth.”

Analysts had mixed reactions towards the deal, with Christopher Fremantle, from Morgan Stanley, saying: “We see Hammerson’s agreed bid for intu as an opportunistic move that combines a strong Hammerson management platform with intu’s large assets but sub-optimal corporate wrapper. Doubts on structural headwinds will remain, but the deal has a number of benefits in our view.”

Shares in Intu are currently trading down 14.97 percent at 228.90 (1531GMT).