UPDATE 1-Metrovacesa confirms to pay to cancel Walbrook
* To pay 100 million pound penalty.
* Says agreed with Legal & General to cancel project (Adds background)
MADRID, August 3 (Reuters) - Spanish property company Metrovacesa MVC.MC said on Monday it is pulling out of the Walbrook property project in London and would pay a 100 million pound ($165.4 million) penalty.
Metrovacesa said it had reached an agreement with British insurer Legal & General (LGEN.L) to cancel the Walbrook project, confirming a report by Reuters late on Friday.
The Spanish company bought the Walbrook project, a prime property site in London's financial district, from Legal & General in Sept. 2006.
They had agreed to begin demolishing the buildings in Walbrook Square before Dec. 2012 to build an office complex, and had planned to invest around 840 million sterling to 2020. ($1=.6045 Sterling) (Reporting by Paul Day; Editing by Hans Peters)
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