Bloomfield Hills-based mall owner and developer Taubman Centers has been sold to Simon Property Group, the largest mall operator in the U.S., in a deal once threatened by the COVID-19 pandemic.
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Indianapolis-based Simon announced Tuesday that it has finalized its $3.4 billion purchase of an 80% ownership stake in The Taubman Realty Group Limited Partnership, which gives it full ownership of Taubman Centers, including Taubman’s remaining two Michigan malls: Great Lakes Crossing Outlets in Auburn Hills and Twelve Oaks Mall in Novi.
According to Taubman’s family, it sold about one third of its ownership interest in this deal. However, it still owns 20% of the limited partner. to a news release.
Simon was to pay $43 per share for Taubman, down 18% from the $52.50 per share price when the deal was announced on the eve of the pandemic’s arrival in early February. In June, Simon threatened to pull out of the deal, saying the pandemic and mall shutdowns had put tremendous financial strain on Taubman and that “extreme actions” might be necessary to rescue the company.
Taubman insisted that Simon remained legally bound to finish the deal and filed a compliant in Oakland County Circuit Court.
The companies ultimately agreed to settle the litigation and last month announced a modified deal including the price cut.
A Simon representative was not immediately available for comment late Tuesday afternoon about the deal and whether any changes are expected at Twelve Oaks Mall or Great Lakes Crossing Outlets.
Taubman Centers owns or manages 26 malls or large shopping centers in the U.S. and Asia. It previously owned The Mall at Partridge Creek in Clinton Township and Fairlane Town Center in Dearborn, but sold them in 2014 along with several other malls in other states to Starwood Capital Group. It developed and sold Lakeside Mall in Sterling Heights years earlier.
Simon has a larger portfolio of more than 200 malls and shopping centers, including Birch Run Premium Outlets and Briarwood Mall in Ann Arbor.
Ironically, Taubman Centers once waged war to stop Simon Property Group from buying it in 2003. The Taubman clan then informed Simon Property Group that their company was not for sale. “not for sale.”
The hostile takeover was stopped by the former Gov. Jennifer Granholm signed changes to Michigan’s anti-takeover law — the Michigan Control Share Acquisitions Act — that allowed the Taubman family to block the all-cash offer by Simon and a partner, Westfield America Inc.
Company founder and celebrated philanthropist A. Alfred Taubman died in 2015 at age 91.
This report was contributed by The Associated Press.