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Simon Pulls GGP Bid
Crossing the wires. GGP down 10% today. When all is said and done Hovde will have been called an optimist in his valuation of the bankrupt mall operator.
SPG Will Not Participate in Bidding Process in GGP Bankruptcy
Business Wire
INDIANAPOLIS -- May 07, 2010
Simon Property Group, Inc. (NYSE: SPG) (“SPG”) today announced that it has withdrawn its fully financed acquisition and recapitalization proposals for General Growth Properties, Inc. (NYSE: GGP) (“GGP”).
David Simon, Chairman and Chief Executive Officer, said, “GGP’s decision to move forward with the latest Brookfield-sponsored change of control recapitalization, without giving due consideration to SPG’s proposals, is a truly unfortunate result for all GGP stakeholders. The transaction approved today values GGP at a minimum of $5.00 less per share than SPG’s $20.00 per share offer, when accounting for the highly expensive and dilutive warrants to be issued to the Brookfield consortium.”
Simon continued: “We are disappointed that the GGP board hastily decided in less than 24 hours to accept substantially less value, rather than take more time to fully assess the benefits of SPG’s offer and enter into negotiations to make this value available to GGP shareholders. In addition, SPG’s recapitalization proposal offered the certainty GGP desired along with an $11.00 per share value, which is also substantially higher than what GGP shareholders will receive under the plan approved today, after taking the highly expensive and dilutive warrants into account.”
Simon added: “For many months, SPG has tried to work collaboratively and productively with GGP to bring our proposals to fruition. SPG has been highly flexible, making numerous changes to its proposals in response to requests from GGP, its stakeholders and its advisors. GGP’s decision to proceed with a transaction that transfers hundreds of millions of dollars in value to the Brookfield consortium has caused us to conclude that we cannot reach a mutually beneficial transaction with GGP. As a result, it is in SPG’s best interests to withdraw our proposals and decline to participate in the bidding process in the GGP bankruptcy.”
Simon concluded, “I am confident in our ability to grow the business as we have done historically. We will continue to focus on our business and evaluate other opportunities in the marketplace as we always have: prudently, in a disciplined manner, and in the best interests of our shareholders.”
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Anything has a buyer at the right price.... and apparently GGP was priced incorrectly. Ha.
Looks like General Growth has gangrene.
Bumber. I was getting all excited about starting a short position in SPG if they went through with it.
GGP is a cesspool. It's going down and will take down anyone stupid enough to buy it. UNLESS it's with taxpayer's money. Then the buyer would be a genius (sarcasm), kind of like JPM.
...or Maiden Lane (Red Roof Inn). It's easy to be the starting quarterback when your dad is the coach.
All of RE is heading for a new leg down. I had a client tell me the other day that the bank wouldn't do a 30 year fixed because they can't sell them to Fannie/Freddy. Apparently PNC can only get 2yr balloon interest only adjustable rate mortgages insured by the GSEs.
Expect a big drop in RE in the middle of summer...residential and commercial.
That's not a good sign considering PNC is their best producer.
How big of a drop? All based on lack of financing? Prices are already down 44% from 2007
"big drop in RE in the middle of summer...residential and commercial"
Hard to believe for residential since (late) summer is when house buying is at its peak.
HUGE amount of resets starting in june and peaking in September, so yes another leg down as people walk away and jingle mail in Sept or stay for free in their homes. Expect RE 'bargains' in January 2011. Personally, DO NOT BUY RE unless it i about 20% offf current pricing (or ~30% of it's peak).
TYLER...HOPE YOU READ THIS! Could not get on to the site most of the day today and yesterday! You guys need to upgrade your servers! Love You!
Am I the only one having this problem?
No. Everyone needs to donate.
Just you.
The rest of us all have secret decoder rings that allow us to decipher the codes necessary to access the secret URL's.
Rings that fit fat fingers.
there are no bad stocks.. only bad prices..
"I see value."
Goldman wins again! YAAAAAAAAAAAAAAAAAYYYYYYYYYYYYYYYYYYYYYY!!!!!
So, $10.50 a share plus $2b in backstop...
verse...
$20 a share? becuase Simon has more to gain from seeing GGP turned into pieces? which would once again allow share holders to realize yet more profits?
GGP share price was $15.50(ish) down to $14.00(ish)...
********** "
Simon had offered $20 a share to take over GGP, even though General Growth hasn’t seen that price since late 2008. Since the hearing started at 10 a.m. this morning, GGP’s stock fell from $15.80 per share to a low of $14.
Brookfield pledged to help bring GGP out of bankruptcy by purchasing GGP stock at $10.50 per share, resulting in a $6.5 billion equity investment and $2 billion capital backstop offer, which includes assistance from Pershing Square Capital Management and Fairholme Funds. The Brookfield deal comes with several million dollars in warrant fees to GGP, though Brookfield has agreed to postpone some of the costs." **************
*********** ( http://www.globest.com/news/1657_1657/chicago/184902-1.html ) **************
The Squid Squirts Again! YAAAAAAAAAAAAAAAAAYYYYYYYYY!!!!!!!!
*********** "Simon has said its offer is better, and cheaper, as the Indianapolis-based mall giant’s offer doesn’t require almost $1 billion in warrant fees. The Wall Street Journal report says that Brookfield kept the warrants in its latest offer, but agreed to delay the 40%." **************
************ ( http://www.globest.com/news/1653_1653/chicago/184777-1.html ) ***********
"The Brookfield Consortium" has a 0% Fed Window at Goldman to draw down on when needed, BITCHES!!!!!
Hovde called for GGP to be $5
Even at $14 , he is off by a bit !!!!
Posted May 1st - a week before the crash.
'11,250 / 300 is an area of significant resistance and if this level can’t be breached it should signal the end of the March 2009 bear market rally - the weekly DOW chart shows an expanding wedge indicating a significant move is probable - this remains an overbought bear market rally and the uptrend could falter at any time - the VIX index continues to give bullish warnings which is bearish for equities - long term charts of key equity indexes continue to give bearish warnings and the March 2009 lows will be breached in my opinion - USD Index bullish warnings since 2009 on the weekly and monthly chart have not changed and further USD strength and thus EURO weakness is still expected '
http://www.zerohedge.com/forum/latest-market-outlook-0
http://stockmarket618.wordpress.com