Over the Thanksgiving weekend, it was revealed that Simon Property Group sent a letter to U.K.-based mall owner and operator Capital Shopping Centres asking Capital not to proceed with offering $1.2 billion in shares as part of an agreement to purchase the Trafford Centre shopping mall.
According to Capital, Simon wanted an "opportunity to present CSC with a potential cash offer for the Company at an unspecified premium to NAV." Analysts estimate that an acquisition of CSC would cost more than $3.6 billion. The rumors sent CSC's stocks soaring by nearly 20 percent. Even if Simon doesn't move ahead, there is also speculation that Westfield Group, which already has a large U.K. presence, might also mount a takeover bid.
Simon, which mounted a bit to acquire General Growth Properties during the latter's reorganization process, certainly has the buying power to complete such a. And, it should be noted, Simon already does own a 5.6 percent stake in CSC. The question is whether Simon will actually move forward or not. For its part, Simon has not issued any releases or SEC filings about this potential deal.
The New York Times Dealbook blog said hopes for a deal might have been dashed when CSC opted to move ahead with the Trafford Centre deal. However, the Telegraph reported today that Simon asked Citigroup to advise it on a potential acquisition. The Telegraph also identified the potential price tag as $5.5 billion--substantially higher than other estimates.
So here we go again.
Here are some otherand notes from around the retail real estate world.
- Rick Caruso plans expansion of Americana shopping mall in Glendale (Los Angeles Times
- Shopping Centers Facing Challenges (Commercial Real Estate Insider Blog)
- Restaurant Performance Index highest in three years (Calculated Risk)
- Developers using social media to fight opponents (Wall Street Journal)
- A New Push to Rescue Xanadu Mall Project (New York Times)
- Falling Retail Rents Mean More Store Openings (CoStar)