BROOKFIELD’S $2.6B GGP SAVE

It doesn’t look like Simon Property Group will be adding Water Tower Place to its portfolio. Yesterday, General Growth Properties announced a $2.6B proposed equity commitment from Brookfield Asset Management, a restructuring that will allow GGP to emerge from Chapter 11 on a standalone basis.
 

The firms reached an agreement in principle for Brookfield to invest in a proposed recapitalization of GGP at a plan value of  $15/share and provide par plus accrued interest to unsecured creditors. Under the terms, Brookfield will own approximately 30% of GGP. The REIT will distribute to its shareholders shares in GGO, a new company that will own certain non-core assets producing little or no current income but have long-term value potential. The plan is subject to definitive documentation, approval of the bankruptcy court, and higher and better offers pursuant to a bidding process to be approved by the court.


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