Spain's Colonial to sell Riofisa's Principe Pio Madrid trophy asset to Corio-sources

Spain's struggling Inmobiliaria Colonial has commenced the task of breaking up Riofisa, its retail leisure centre development company, sources say. The Dutch Corio is near to signing purchase of the Principe Pio Retail Leisure Centre in Madrid, Riofisa's flagship asset valued recently at e125m. The sale would mark the start of the break-up and signal that the banks which control Colonial have given up attempting to find a buyer for the entire group. A number of companies were initially interested in the purchase of Riofisa when it was placed on the market some nine months ago, and Colonial was hoping to pocket e700m. The sale of Riofisa is the main remaining unfulfilled obligation of Colonial to its creditor banks in return for refinancing the company last summer. Colonial in 1Q09, reported a small e1.4m net profit compared to a e272m loss 12 months earlier.