This is good news for shareholders…..
If SPG was making ANY headway with the GGP board in convincing them to accept their offer over Brookfield’s, this trip would not be necessary. They fact they are going out there and David Simon himself is going to make a pitch means that at least in preliminary discussions, the GGP board has wisely not been enamored with the offer.
Barring a material improvement in the price of the offer from SPG, I just don’t see it being the deal that goes forward to the court next Thursday.
Simon Property Group Inc (SPG.N) is expected to make a presentation about its offer to recapitalize General Growth Properties Inc (GGP.N) before the rival company’s board of directors on Thursday, sources familiar with the situation said.
Simon Chief Executive David Simon is expected to travel to Chicago to be at the meeting, the sources said.
The two sides have been in talks over Simon’s offer, one of the sources said.
The sources declined to be identified because the discussions are not public.
Simon made a surprise offer last week to recapitalize General Growth in a bid to replace Brookfield Asset Management (BAMa.TO) as the key investor to help the U.S. mall owner emerge from bankruptcy as a stand-alone company.
General Growth, the No. 2 U.S. mall owner, has been operating under bankruptcy protection for a little more than a year. It has filed a plan to emerge from bankruptcy as a stand-alone company, with a $6.55 billion cash infusion from Brookfield and investors Fairholme Capital Management and Pershing Square Capital.
That offer includes the three capital sources receiving 120 million warrants. Simon has countered with an offer to step into Brookfield’s place without the 60 million warrants Brookfield wants.
The meeting with David Simon would be held on the day of the objection deadline for those opposed to the plan backed by Brookfield and Fairholme-Pershing.