US-based real estate investment trust (REIT) Simon Property Group is buying mall owner Taubman Centers in a $3.6bn deal.
The two REITs said Simon Property is offering $52.50 a share in cash to buy an 80% stake in The Taubman Realty Group Limited Partnership (TRG), an offer which represents a 51% premium to the share’s closing price on Friday.
The Taubman family remain a 20% partner in TRG which holds 26 super-regional shopping centres in the US and Asia.
Simon Property expects to fund the acquisition with its existing cash.
TRG will continue to be managed by its existing executive team, under the leadership of Taubman chairman, president and CEO Robert S Taubman, in partnership with Simon Property, the companies said.
Simon Property chairman of the board, CEO and president David Simon, said: “By joining together, we will enhance the ability of TRG to invest in innovative retail environments that create exciting shopping and entertainment experiences for consumers, immersive opportunities for retailers, and substantial new job prospects for local communities.”
Myron E Ullman, lead director of the Taubman board of directors and chairman of the special committee of the Taubman board of directors, said: “The Taubman board of directors has always been focused on maximising shareholder value.
“With this transaction, we will deliver a significant, immediate cash premium to shareholders. The special committee of the board unanimously believes that this transaction with Simon is a great outcome for all of our stakeholders.”