Brookfield bids $14.8bn for rest of mall landlord GGP
Brookfield Property Partners LP bid about $14.8bn to acquire the stake it doesn't already hold in US mall owner GGP Inc as the companies seek to repurpose struggling bricks-and-mortar shopping centres.
The firm offered $23 a share for the 66pc of GGP it doesn't own, Brookfield said in a statement last Monday. That's about 21pc more than Chicago-based GGP's closing price on November 6, the day before Bloomberg News reported Brookfield had held discussions about taking the company private.
GGP said in a separate statement that its board formed a special committee to review the unsolicited proposal.
Brookfield Property Partners is the real estate unit of Toronto-based Brookfield Asset Management Inc. Brookfield Asset has been focussing on buying and revamping shopping centres to take advantage of the land they occupy in urban areas, ceo Bruce Flatt said on a conference call last week.
GGP last month reached an agreement with AvalonBay Communities Inc to build apartments at a shopping centre in Seattle, and ceo Sandeep Mathrani said the company "will look to explore similar projects at other locations."
Brookfield Property plans to "leverage our expertise to grow, transform or reposition GGP's shopping centres, creating long-term value in a way that would not otherwise be possible," ceo Brian Kingston said in his statement.
The transaction would create one of the largest listed property companies in the world, with stakes in almost $100bn of real estate globally and annual net operating income of about $5bn, Brookfield said.
Shares of mall companies have been hit hard as the rise of e-commerce squeezes traditional retailers.
Store closures are accelerating, pressuring landlords to fill empty space and reinvent shopping centres.