Canadian Company Brookfield To Buy Mills Corp
The Canadian company, Brookfield Properties, has tendered an offer for the Mills Corp. for 7.5 billion dollars for the Mills Corp. today. Brookfield has had a large presence in office property with large holdings in New York, Boston, Washington, D.C., Los Angeles, Houston, Toronto, and Calgary. The entrance into the shopping plaza and mall business will be fairly new for the company, but will get Mills Corp. out of the ill fated situation they created with the Xanadu development in New Jersey.
Mills shareholders would receive $21 in cash for each share of Mills common stock they hold, a 19 percent premium over Mills’ closing stock price Tuesday. With assumed debt and preferred stock, the total value of the deal would be $7.5 billion. Toronto-based Brookfield also has agreed to provide Mills with debt financing until the acquisition can be completed.
After a very competitive process, in which our board considered numerous alternatives for the company, we believe we have achieved an outcome that is the best possible result for all involved,” says Mills CEO Mark Ordan in a statement. The Brookfield announcement comes just a day after Mills’ largest shareholder, a San Francisco-based hedge fund, offered to increase its stake in the company. Its second-largest shareholder, an Israeli-based real estate development firm, had offered to make a significant additional investment in Mills.
Chevy Chase-based Mills, which has been selling properties to pay down debt as it faces huge cost overruns on its biggest-ever project at the New Jersey Meadowlands, said last fall it would consider selling the company. Mills said last week accounting errors could cost it more than $350 million and could force the company into bankruptcy protection.
If the deal is completed, Brookfield would get more than 3 dozen regional shopping malls developed by Mills, including Potomac Mills and Arundel Mills malls. Brookfield (NYSE and TSX: BAM) and Mills (NYSE: MLS) expect the merger to close in the second half of 2007. via American Business Daily
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[...] looks like the bid for the Mills Corp. by Brookfield Asset Management is going to get some competition. A partnership between Simon Property and Farallon Capital [...]