 |
 |
 |
 |
 |
 |
 |
 |
Shopping Centers Today -> June 2003
 PRINT THIS STORY: |
  CHANGE TEXT SIZE: |
SIMON WINS TAKEOVER RULING
BY IAN RITTER
The Taubman family cannot use a block of preferred shares to stop the $1.68 billion ($20 per share) takeover bid by Simon Property Group and partner Westfield America Trust. U.S. District Judge Victoria Roberts has ruled, handing the two suitors a victory in their lawsuit against Taubman.
“These shares may not be voted on unless voting rights are extended to the shares in accordance with the Michigan Control Share Acquisitions Act,” Roberts wrote in a clarification of her May 1 ruling. The original decision left unclear whether the restriction applies to a total 33.6 percent preferred-share block that Taubman holds with others, or only to the 3 percent the court said Taubman illegally used to form an alliance to oppose the bid.
Immediately following the clarification, Taubman’s stock shot up to $19.50 from the previous day’s $18.50 trading range.
The ruling means the preferred shares can’t be used to stop common-stock holders from overturning a charter provision that forbids any single party from owning more than 8 percent of common stock, says Morgan Stanley REIT analyst Matthew Ostrower. The removal of the provision would pave the way for the bidders to buy Taubman. Common-stock holders have already tendered to Simon and Westfield America 85 percent of their stock (44.1 million out of 52.2 million common shares).
“This is a big victory for Simon,” Ostrower said. But he added a caveat: “This is a battle. This is not the whole war.”
Taubman plans to appeal. “This ruling is so wrong that we are extremely confident that it will not withstand our appeal,” the company wrote in a press statement.
In a press release of their own, Simon CEO David Simon and Westfield America CEO Peter Lowy said: “We remain committed to give [Taubman] shareholders the opportunity to accept our $20-per-share all-cash offer, and today’s court decision is a significant step in that direction.” Simon originally filed its lawsuit in January, and Westfield America joined the bid in February.
Simon launched its takeover bid in November with an offer of $17.50 a share.
 | Current Issue November 2008 |