General Growth Properties, Inc. Files for Chapter 11 Protection; Broken Credit Markets Require GGP to Reduce & Restructure Debt
April 16 2009 - 2:53AM
Business Wire
GENERAL GROWTH PROPERTIES, INC. (NYSE:GGP) today announced it is
voluntarily seeking relief to reduce and restructure its debts
under chapter 11 of the United States Bankruptcy Code in the United
States Bankruptcy Court for the Southern District of New York. In
addition, approximately 158 regional shopping centers owned by GGP
and certain other GGP subsidiaries (collectively with GGP, the
�Company�) have also filed for protection. The Company intends to
work with its constituencies to emerge from bankruptcy as quickly
as possible while executing on a plan of reorganization that
preserves the Company�s integrated, national business
operations.
Certain subsidiaries, including GGP�s third party management
business and GGP�s joint ventures, have not filed for protection. A
complete list of subsidiaries that have filed voluntary petitions
can be found at www.ggp.com.
All day-to-day operations and business of all of the Company�s
shopping centers and other properties will continue as usual.
The decision to pursue reorganization under chapter 11 came
after extensive efforts to refinance or extend maturing debt
outside of chapter 11. Over many months, the Company has endeavored
to negotiate with its unsecured and secured creditors to obtain the
time needed to develop a long-term solution to the credit crisis
facing the Company. Unable to reach an out-of-court consensus, the
Company reluctantly concluded that restructuring under the
protection of the bankruptcy court was necessary. During the
chapter 11 cases, the Company will continue to explore strategic
alternatives and search the markets for available sources of
capital. The Company intends to pursue a plan of reorganization
that extends mortgage maturities and reduces its corporate debt and
overall leverage. This will establish a sustainable, long-term
capital structure for the Company.
The Company also announced it has received a commitment for a
debtor-in-possession financing facility of approximately $375
million from Pershing Square Capital Management, L.P., as agent.
When approved by the bankruptcy court, the new facility will
provide a source of funds to the Company during the chapter 11
process. The Company has requested, and expects to receive,
additional approvals to give the Company the authority to make
payments to ensure that the Company�s shopping centers and other
properties continue to operate uninterrupted in the ordinary course
of business, including paying employee compensation, certain
critical service providers, insurance and other claims. The Company
intends to pay all providers of goods and services delivered
post-petition.
�Our core business remains sound and is performing well with
stable cash flows. We believe that chapter 11 is the best process
for restructuring maturing mortgage loans, reducing the Company�s
corporate debt, and establishing a sustainable, long-term capital
structure for the Company,� said Adam Metz, Chief Executive Officer
of the Company. �While we have worked tirelessly in the past
several months to address our maturing debts, the collapse of the
credit markets has made it impossible for us to refinance maturing
debt outside of chapter 11,� he said.
GGP
Information/Website
The Company currently has ownership interest in, or management
responsibility for, over 200 regional shopping malls in 44 states,
as well as ownership in master planned community developments and
commercial office buildings. The Company�s portfolio totals
approximately 200 million square feet of retail space and includes
over 24,000 retail stores nationwide. The Company is listed on the
New York Stock Exchange under the symbol GGP.
Media Conference
Call
General Growth Properties will host a media conference call to
discuss its chapter 11 filing on Thursday, April 16, 2009, at 11:00
a.m. Central Standard Time. Only members of the media may
participate in the live conference call by dialing (800) 762-8779
(toll-free domestic) or (480) 629-9770 (international); passcode:
4059520. Please register at least 10 minutes before the conference
call begins. A replay of the call will be available for one week
via telephone starting approximately one hour after the call ends.
The replay can be accessed at (800) 406-7325 (toll-free domestic)
or (303) 590-3030 (international); passcode: 4059520.
Satellite Feed
Available
A satellite feed of General Growth Properties President and COO
Tom Nolan�s comments about today�s filing is accessible for
broadcasters at the listed times and coordinates.
Thursday, April 16, 2009,
07:00-07:15 EST (7:00-7:15 a.m. EST)
� SATELLITE: AMC 6 TRANSPONDER:
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AUDIO:
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Thursday, April 16, 2009,
14:45-15:00 EST (2:45-3:00 p.m. EST)
� SATELLITE:
Galaxy 28
TRANSPONDER:
15 C
DL FREQUENCY:
4000 Vertical
AUDIO:
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For more information, please visit the Company website at
www.ggp.com. Parties may also obtain more information by visiting
the claims agent�s website at www.kccllc.net/GeneralGrowth or
calling the claim agent�s toll free hotline � 1-888-830-4665.
Forward Looking
Statements
This press release contains forward-looking statements. Actual
results may differ materially from the results suggested by these
forward-looking statements, for a number of reasons, including, but
not limited to, the impact of our bankruptcy filing, our ability to
refinance, extend or repay our near and intermediate term debt, our
substantial level of indebtedness and interest rates, retail and
credit market conditions, impairments, land sales in the Master
Planned Communities segment, the cost and success of development
and re-development projects and our ability to successfully manage
our strategic and financial review and our liquidity demands.
Readers are referred to the documents filed by General Growth
Properties, Inc. with the Securities and Exchange Commission, which
further identify the important risk factors which could cause
actual results to differ materially from the forward-looking
statements in this release. The Company disclaims any obligation to
update any forward-looking statements.
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