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Simon Completes $3 Billion Taubman Mall Merger

The Simon Property Group’s $3 billion deal to acquire an 80 percent majority stake in The Taubman Realty Group Limited Partnership (TRG) has finally closed.

Simon closed on the transaction one day after Taubman shareholders, at a special meeting Monday, approved of the restated merger agreement from Nov. 14, with over 99.9 percent of the shares voted in favor of the deal.

The Nov. 14 agreement reduced the purchase price to $3 billion, or $43 a share, from $3.6 billion, or $52.50 a share. The initial $3.6 billion deal was inked in February before the coronavirus pandemic. When stores and malls began reopening in May and June after a temporary shutdown to help curb the spread of the virus, Simon backed out of the deal. Litigation ensued and the new price reduction helped settle their legal dispute.

Now that the deal has closed, the Taubman family is still involved in the business and remains a 20 percent joint venture partner in TRG. The family sold about one-third of its ownership interest at the $43-a-share transaction price.

“We are very pleased to complete this transaction and to add some of the world’s premier retail assets to our portfolio,” David Simon, Simon’s chairman and CEO, said. “This investment will enhance the ability of TRG to establish innovative retail environments for consumers and to create new job prospects for the communities in which it operates. I look forward to partnering with the Taubmans in this exciting new joint venture, and to driving strong performance at TRG’s properties.”

Robert Taubman, chairman and CEO of TRG, added that the Simon CEO and I share a vision for optimizing TRG’s assets and a strong commitment to our shoppers, retail partners and communities. I am excited to work with the entire Simon team as we share ideas and implement best practices to enhance the operations and cash flow of our new joint venture.”

Simon has been busy on the acquisitions trail this year. The mall operator opened the year by acquiring a stake in bankrupt fast-fashion chain Forever 21, in partnership with brand management firm Authentic Brands Group (ABG) and its real estate investment trust competitor Brookfield Asset Management. Simon later joined forces with Brookfield to acquire the operating component of bankrupt J.C. Penney. And Simon, through its ABG joint venture partnership, Sparc, similarly acquired bankrupt Lucky Brand Dungarees and American retailer Brooks Brothers, also out of bankruptcy.

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