Simon Property Group and mall real estate investment trust Taubman Centers Inc. announced today they have entered into a definitive agreement in an all-cash deal valued at $3.6 billion.
Simon operates St. Louis Premium Outlets in Chesterfield, just a short distance from Taubman Prestige Outlet, also in Chesterfield Valley.
Under the agreement, Simon will acquire an 80% ownership interest in The Taubman Realty Group Limited Partnership and the Taubman family will sell approximately one-third of its ownership interest at the transaction price, and remain a 20% partner in Taubman.
TRG’s ownership includes 26 retail assets and will continue to be managed by its existing executive team, under the leadership of Taubman chairman, president and chief executive officer, Robert S. Taubman, in partnership with Simon. The parties have agreed to work together to implement best practices to achieve operational efficiencies, and will eliminate Taubman’s public company costs immediately following closing.
Simon chairman of the board, chief executive officer and president, David Simon, stated, “We are very pleased to announce this transaction, which will be immediately accretive to Simon’s FFO. By joining together, we will enhance the ability of TRG to invest in innovative retail environments that create exciting shopping and entertainment experiences for consumers, immersive opportunities for retailers and substantial new job prospects for local communities. I look forward to partnering with Bobby and the TRG executive team in this exciting new joint venture.”
Myron E. Ullman, lead director and chairman of the special committee of the Taubman board of directors, added, “The Taubman board of directors has always been focused on maximizing shareholder value. With this transaction, we will deliver a significant, immediate cash premium to shareholders. The special committee of the board unanimously believes that this transaction with Simon is a great outcome for all of our stakeholders.”
The transaction is expected to close in mid-2020.