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Simon Property and Taubman revise terms of merger deal

FILE PHOTO: Shoppers ascend and descend escalators at the King of Prussia Mall, owned by Simon Property Group, United State’s largest retail shopping space, in King of Prussia, Pennsylvania, U.S., December 8, 2018. REUTERS/Mark Makela

Simon Property Group, the largest US mall operator, has reached an agreement to cut the price of its stalled takeover of rival Taubman Centers to $43 a share in cash.

Under the original agreement announced in February, Taubman shareholders were to receive $52.50 per share in cash.

Taubman owns, manages and/or leases 23 super-regional shopping centres in the US and three in Asia via its Hong Kong-headquartered Taubman Asia business. 

The revised agreement continues to provide that Simon will acquire an 80-per-cent ownership in The Taubman Realty Group (TRG) Ltd Partnership, they said.

The Taubman family will sell about one-third of its ownership interest at the transaction price and continue to hold a 20 per cent stake in TRG, the companies added.

Simon and Taubman said they also have settled their pending litigation in Michigan state court over the merger.

Simon Property said in June it was abandoning the deal, citing the hit the retail sector has taken during the Covid-19 pandemic. Simon Property also said that Taubman did not cut costs to mitigate the impact of the pandemic.

Taubman had said at that time Simon’s termination of the deal was without merit and it filed a counterclaim in lawsuit, rejecting Simon’s allegations.

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