The Real Deal New York

Brookfield makes $15B bid to buy remainder of GGP

Toronto-based giant offers $23 per share for remaining 66%
November 13, 2017 08:00AM

From left: Ric Clark, Sandeep Mathrani and 685 Fifth Avenue (Credit: Getty Images and Thor Equities)

Brookfield Property Partners made a $14.8 billion offer Saturday to buy the remaining 66 percent of shares that it doesn’t already own in GGP.

Brookfield offered to pay $23 per share, half of it in cash and the other half in equity, the Wall Street Journal reported. Any deal would need the approval of a majority of GGP shareholders not affiliated with Brookfield.

The move comes after reports surfaced last week that Brookfield was in early talks to buy the retail real estate investment trust and take it private. Shares of GGP closed at $22.20 after surging following the reports.

Brookfield during the third quarter increased its stake in GGP from 29 percent. The Toronto-based real estate firm has been an investor in GGP since 2010, when it struck a deal that pulled the Chicago-based mall owner out of bankruptcy.

Rumors began to circulate in early 2016 that Brookfield was considering a GGP buyout, but company executives dispelled the notion saying they were “happy with our GGP investments in their current form.”

Part of the thinking behind this latest proposal is that it would allow Brookfield to add features like office space, entertainment and apartments to GGP’s malls which, like others across the country, has struggled with store closings.

GGP’s taken space back from poor-performing department stores and replaced them with gyms, high-end grocery stores and fast-fashion retailers. [WSJ] – Rich  Bockmann