Simon Property Group has filed a proxy statement calling for a special meeting of Taubman Centers shareholders. At the proposed meeting, Simon would attempt to push through proposals that would urge the Taubman board to approve Simon’s tender offer and allow Simon to accumulate more than 9 percent of Taubman’s outstanding shares.
According to Morgan Stanley analyst Matthew Ostrower, Simon needs 40 percent of Taubman shareholders to vote for the meeting in order to force it to occur. "Although Simon may be successful in calling for the meeting, Taubman’s current charter might make the whole exercise simply symbolic," he writes in a report on the filing. At least one of the proposals Simon wants to push at the meeting would require a two-thirds vote. Since the anti-merger Taubman family controls one-third of the REIT’s voting shares, Ostrower concludes the gesture is more an effort on Simon’s part to pressure independent Taubman board members to approve the offer.
Taubman responded to Simon’s proxy statement in a press release issued today: "Simon is waging a campaign to nowhere while wasting valuable corporate assets of both companies. It cannot be clearer — two-thirds of Taubman’s outstanding shares must approve any sale transaction or any amendment to the corporate charter. The owners of over one-third of the outstanding Taubman shares have publicly announced their opposition to Simon’s offer."
Ostrower says the latest exchange is just another in a series of twists and turns that will occur before the deal is finally sealed. "Despite the ongoing ups and downs of the conflict, we continue to believe that Taubman will eventually trade hands, potentially at a price higher than $18 per share."
For more background information on the Taubman/Simon dealings, see past news updates on www.shoppingcenterworld.com.
