Rouse Properties Agrees to Brookfield's Increased Buyout Offer
February 25 2016 - 9:35AM
Dow Jones News
By Anne Steele
Rouse Properties Inc. said Thursday that it agreed to be taken
private by an affiliate of Canada's Brookfield Asset Management
Inc. in a deal valuing the U.S. mall operator at $1.06 billion.
Brookfield has been in pursuit of Rouse, having made public a
lower offer to buy the company in January.
Brookfield, whose Brookfield Property Partners LP already holds
a 33% stake in Rouse, will buy Rouse's remaining stock for $18.25 a
share in cash. The Canadian asset manager says the deal's value
including debt is $2.8 billion.
The purchase price represents a 35% premium over Rouse's closing
price Jan. 15, the last trading day before Brookfield's first offer
to buy Rouse became public. The agreed-upon offer is $1.25 a share
higher than Brookfield's original $17-a-share offer.
Shares of Rouse rose 1.6% premarket to $18.04.
"Brookfield's increased proposal provides shareholders with
compelling value as well as a high degree of execution certainty,"
David Kruth, chairman of the Rouse board's special committee, said
Thursday.
Brookfield oversees $123 billion in commercial and residential
real estate, spread across North America, parts of Europe, Asia and
South America. Its bid for Rouse underscores the Toronto-based
company's focus on using its financial muscle and scale to acquire
out-of-favor real-estate assets.
The deal comes at a time when the stocks of Rouse and many other
U.S. shopping-mall rivals are under pressure amid concerns their
earnings are at risk due to overbuilding and the rise of
e-commerce.
Rouse said Thursday that it won't host an earnings conference
call for its fourth quarter and full-year 2015 results or provide
financial guidance. It also won't declare its regular quarterly
dividend during the pending period of the transaction.
Write to Anne Steele at Anne.Steele@wsj.com
(END) Dow Jones Newswires
February 25, 2016 09:20 ET (14:20 GMT)
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