Simon Property Group has offered to pay $10 billion to take over bankrupt US mall owner General Growth Properties.
The unsolicited offer was made public today after Simon and GGP held a meeting last week. Simon said in a statement it had yet to receive a “substantive response” to its bid, which includes $9 billion cash, “nor any indication that [GGP is] prepared to enter into serious discussions so as to make our offer available to your shareholders and creditors. Accordingly, we are today making our offer public”.
David Simon, chairman and chief executive officer, of Simon Property Group
Simon has offered to pay GGP shareholders $6 a share plus a stake in property assets valued roughly at $3 a share. Simon said the deal would give unsecured creditors, lenders and note holders 100 percent cash recovery of par value, worth an estimated $7 billion. Existing secured debt on GGP’s assets would remain in place. 
Our offer provides much-needed certainty to conclude General Growth's protracted reorganisation process. We are confident it is the best option for all General Growth constituencies and far superior to any other third-party proposal or stand-alone plan that could be completed.
GGP and hundreds of its malls filed for bankruptcy in April last year. In December, GGP reached agreement to reorganise $9.7 billion of debt secured against its shopping centres, offices and other real estate assets. GGP, the US’ second largest mall owner, has the exclusive right to come up with its own reorganisation plan until late February, Reuters said at the time.
Simon today said a committee of unsecured GGP creditors backed its $10 billion offer and would encourage “GGP to engage with Simon without delay”.
“Our offer provides much-needed certainty to conclude General Growth's protracted reorganisation process. We are confident it is the best option for all General Growth constituencies and far superior to any other third-party proposal or stand-alone plan that could be completed,” David Simon, chairman and chief executive officer, of Simon Property Group said in a statement.
Simon refused to keep the deal indefinitely on the table though insisting it was “not open-ended, particularly given the uncertain economic environment that exists today”. Simon expects to finance a potential deal from cash on hand, credit facilities and equity co-investment by institutional investors.
Lazard, JPMorgan and Morgan Stanley are advising Simon and Wachtell, Lipton, Rosen & Katz is serving as legal advisor.
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