Tags: US | General | Growth | Investment | Offer

General Growth Gets $3.93 Billion Investment Offer

Tuesday, 09 Mar 2010 07:22 AM

Two major investors in General Growth Properties are joining Brookfield Asset Management in offering to inject a combined $6.5 billion in fresh funds into the shopping mall operator to help it emerge from bankruptcy protection.

General Growth said in a statement late Monday that its board is weighing an offer from Fairholme Capital Management, one of its largest unsecured creditors, and Pershing Square Capital Management, one of its largest shareholders, to invest $3.93 billion. It said the new equity capital investment is valued at $15 a share.

The offer would be teamed up with one from Canada's Brookfield Asset Management, which last month said it would to invest $2.6 billion in cash in exchange for General Growth shares.

General Growth said the combined investments, along with it issuing $1.5 billion of debt, would give it the cash it needs to emerge from bankruptcy and pay unsecured creditors in full in cash.

Chicago-based General Growth, the nation's second-largest shopping mall operator, piled up $27 billion in debt by the time it sought shelter from creditors last April. It was the largest real estate bankruptcy in U.S. history.

Last month, it rejected a $10 billion takeover offer by rival shopping mall giant Simon Property Group Inc. that valued the company at about $9 a share.

The Brookfield investment, which values General Growth at $15 a share, is seen as essentially setting Brookfield up as a "stalking horse" bidder as General Growth prepares to solicit buyout offers.

Indianapolis-based Simon has signed a nondisclousure agreement and has begun looking at the company's books even though its offer was rebuffed.

General Growth, meanwhile, said that William Ackman, who runs Pershing Square Capital Management, resigned from General Growth's board of directors in conjunction with hedge fund's participation in the investment offer.

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Two major investors in General Growth Properties are joining Brookfield Asset Management in offering to inject a combined $6.5 billion in fresh funds into the shopping mall operator to help it emerge from bankruptcy protection.General Growth said in a statement late Monday...
US,General,Growth,Investment,Offer
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2010-22-09
Tuesday, 09 Mar 2010 07:22 AM
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