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British Grocer Land Spinoffs Seen Fraught With Risk: Real Estate

Real estate held by some of the U.K.’s biggest supermarket chains is attracting private-equity firms and hedge funds after a 35 percent gain over five years made the stores worth more than the companies that run them.

Activist investor Elliott Management Corp. wants Wm Morrison Supermarket Plc to create a separate company for its real estate, saying it would immediately lift the shares. Elliott last month told Morrison that if Morrison announced a spinoff of most of its real estate, the stock could rise by 45 percent the same day, two people familiar with the matter said.