Leading real estate company Brookfield Property Partners has announced that it has agreed to acquire the remaining 66% of General Growth Properties (GGP), the second biggest US mall owner behind Simon Property Group, in a deal worth $15.3bn.
The deal consists of $9.25bn in cash and approximately 254mn Brookfield Property shares, equating to a value of $23.50 per share. This is up from the previous $23 per share offer from Brookfield Property, totaling $14.8bn, that was rejected by GGP roughly four months ago.
“After careful consideration, assisted by our independent advisors, the Special Committee determined that Brookfield’s improved proposal, which includes an increase in the cash portion of the consideration and the ability to receive shares in a newly listed REIT entity, provides GGP shareholders with certainty of value, as well as upside potential through ownership in a globally diversified real estate company,” said Daniel Hurwitz, Lead Director and Chairman of the Special Committee at GGP.
The combined company will be responsible for approximately $90bn in assets, with an estimated annual net operating income of $4bn, creating one of the world’s largest real estate enterprises.
“We are pleased to have reached an agreement and are excited about combining Brookfield’s access to large-scale capital and deep operating expertise across multiple real estate sectors with GGP’s portfolio of irreplaceable retail assets,” said Brian Kingston, CEO of Brookfield Property Partners.
Once complete, GGP shareholders will own approximately 26% of the merged company.