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REIT Simon Property Group To Raise Half A "Trillion" In New Notes
i) the company is now directly competing with Ben Bernanke in who can raise $1 trillion in toxic debt first
ii) Simon's PR department just tipped their hand on what their ultimate Debt/EBITDA target is
iii) Reuters is sending a subliminal message from the CMSA that the whole securitization thing is no longer an issue, and there is pent up demand for well over a trillion in 4th lien debt "secured" by Eskimo igloos and Gobi desert-based condo-hotels
hat tip Gilgamesh
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hilarious post
As of today I am upgrading Simon Property Group from underperform to Outperform.
I have a target price u$s 81 due to the strong prospects of the real state market.
Happy buying folks ! :-)
A shopping mall near here (owned by Simon) is offering one year free rent, and a free store sign, to sign a lease.
Desperate times call for desperate measures (and a half trillion $$$)
Still ramping.....
The market is so used to talking it terms of billions of losses that it gets written automatically without thinking!
"general business purposes"
comical....
It may already be adjusted for (expected) inflation?
It was a typo from Reuters. They've corrected it. But still, it shows they can raise money at will for a crappy business.
updated, million not billion
http://www.reuters.com/article/rbssFinancialServicesAndRealEstateNews/id...
I think this is gonna come straight from the FED Mint...
$500 BILLION! That's a lot of money just to keep the lights on. SPG must be planning a takeover of Goldman
Its a typo
Re: Points i), ii), and iii freaking hillarious!
Very cagey people over at SPG. By the time the "$500 Billion" of new notes are sold they will be worth $500 million"
My inside sources at SPG have told me they are scheming to use the $500 Billion in fresh money to pay the rent that SPG charges themselves at corporate HQ-$1 million per sq ft per year.
Makes Dr. Evil's demands seem like pocket change
iv) $500 billion in face value translates to $500 million net proceeds to Simon after GS fees and takedown.
Wow 6.75% Of course it isn't such a good rate if you don't get your money back! LOL
They buy at a 7 cap. They borrow at 675. On $500Mil, net to the bottom line = $1.25Mil. Or, assuming no SG&A, half-a-penny per share. I'm surprised the stock didn't rally harder considering such tremendous gearing.