General Growth Properties Inc. announced the departure of its chief financial officer as it also suspended the dividend on its common stock, the real-estate investment trust's latest moves as it strains towith a $27 billion debt load.
The mall owner said Bernard Freibaum is no longer employed by the company. He has unloaded some 83% of his 7.6-million-share stake of late to satisfy margin calls, including just short of 3 million shares Thursday. General Growth said Mr. Freibaum still has about $3.4 million of margin debt outstanding.
The firm added that all executives have said they have no more margin loans outstanding, eliminating the need for them to further dump stock in order to pay back the debt.
General Growth's stock tumbled 48% Thursday, its sharpest decline this year, amid recent stock sales by top executives to cover margin calls and concerns about thehealth of life-insurance companies, a key financing source for the company. The stock closed Thursday at $7.59 and there was no premarket trading; it is down 82% this year.
Update 9:42 AM: The market is embracing these moves. Yesterday's drop--with stock falling almost 50 percent in a day--may also have been overdone. As a result, General Growth's stock rebounded right off the bat and is back up $4.00 in early trading today.