HAMMERSON, Britain's fifth-largest property company and owner of the Brent Cross shopping centre in north-west London, is to raise pounds 251m by selling its Australian property portfolio to AMP Investment.

AMP Investment is the property arm of the Australian AMP insurance group.

The deal is the latest move in a wholesale restructuring of the company since Ron Spinney took over as chief executive in May 1993. Hammerson was harder hit than almost any of its peers by the property slump of 1990-93.

Last month Mr Spinney said the portfolio, which includes the million sq ft Warringah Mall shopping centre in Sydney, had been put up for sale.

The proceeds, which will initially cut gearing to 36 per cent from 63 per cent, will be channelled into European investments, especially in France and Germany, where the property cycle is picking up. The company will make a pounds 73m book profit on the deal as the properties were last valued in December at pounds 178.3m.

Mr Spinney said: 'On the back of a buoyant property market in Australia this year we received a number of approaches from parties interested in acquiring Hammerson Australia both from domestic Australian investors and international investors. Having reviewed these offers, we concluded that we should accept the offer from AMP and reinvest the proceeds in our core territories, particularly in Continental Europe.'

Hammerson received five firm bids, including, it is understood, one from MEPC, which recently raised Adollars 1bn ( pounds 476m) for Australian acquisitions.

Announcing a rise in pre-tax profits from pounds 15m to pounds 24m for the six months to June, Mr Spinney said last month that he planned to invest pounds 100m in the French office and retail market, where tight planning controls are increasing the value of shopping centres.

The restructuring of Hammerson's widely spread international portfolio follows a spectacular fall from grace during the recession and a slower recovery than its peers since then.

It has been estimated that Hammerson is the only big property company whose net assets are lower than they were in 1982 before one of the great property booms.

The decline in shareholders' fortunes can be gauged by the pounds 11 a share that Standard Life paid in 1987 to take its stake to 24 per cent and fend off a 970p bid from the Dutch property company Rodamco. Four years later the shares had tumbled to 165p.

Hamstrung by a monolithic management structure, Hammerson's strategy of geographic diversification failed when the property markets of Britain, the US, Australia and Europe all collapsed together.

Since Mr Spinney took over in 1993, however, the company has put together some daring deals - a shares- for-property swap with PosTel, the post office pension fund manager, the acquisition of the bombed-out former offices of the Hongkong and Shanghai Banking Corporation in the City and three malls in Canada.