Brookfield Property Partners L.P.0’s $15.3 Billion Acquisition of the remaining 66% of GGP

Goldman Sachs Group Inc (GS.N) served as financial adviser and Simpson Thacher & Bartlett LLP served as legal counsel to GGP’s special committee. Citigroup Inc (C.N) served as financial adviser and Sullivan & Cromwell LLP served as legal counsel to GGP. Weil, Gotshal & Manges LLP, Goodwin Procter LLP and Torys LLP served as legal counsel to Brookfield Property.

Brookfield Property Partners L.P. (“BPY”) (NASDAQ:BPY) (TSX:BPY.UN) and the Special Committee of the Board of Directors of GGP Inc. (the “Special Committee”) today announced that BPY and GGP Inc. (“GGP”) (NYSE:GGP) have entered into a definitive agreement for BPY to acquire all of the outstanding shares of common stock of GGP other than those shares currently held by BPY and its affiliates.

In the transaction, GGP shareholders will be entitled to elect to receive, for each GGP common share, either $23.50 in cash or either one BPY unit or one share of a new BPY U.S. REIT security, subject to proration based on aggregate cash consideration of $9.25 billion.

The Special Committee, comprised of non-executive, independent directors, has unanimously recommended that GGP shareholders approve the transaction. The Special Committee believes the transaction is fair to and in the best interests of GGP shareholders.

As a result of the transaction, GGP shareholders who receive equity consideration will be entitled to receive the same amount as BPY’s current distribution on the BPY units or BPR shares they receive, which is over 40% higher than GGP’s dividend (BPY annual distribution of $1.26 per unit vs. GGP dividend of $0.88 per share).

With an ownership interest in approximately $90 billion in total assets and annual net operating income of more than $4 billion, the combined company will be one of the world’s largest commercial real estate enterprises. Following completion of the transaction, GGP shareholders will own approximately 26% of the combined company (calculated based on all BPR shares having been exchanged for BPY units and pro forma for the proposed BAM preferred share conversion as described below), which will possess one of the highest quality and most diverse portfolios of property globally, with a fortress balance sheet and strong overall financial profile.

Brookfield Property Partners is one of the world’s largest commercial real estate companies, with approximately $68 billion in total assets. We are leading owners, operators and investors in commercial real estate, with a diversified portfolio of premier office and retail assets, as well as interests in multifamily, triple net lease, industrial, hospitality, self-storage, student housing and manufactured housing assets. Brookfield Property Partners is listed on the New York and Toronto stock exchanges. The company, led by Richard B Clark, Brian W Kingston and Roberto Perroni in 2017 recorded C$7.966 Billion Revenues.

Goodwin advised Brookfield Property Partners with a team including Mark Kirshenbaum, Gil Menna, Mark Opper, Daniel Adams, David Roberts, Jason Vollbracht, Adam Romig, Chris Versfelt, Caitlin Tompkins and Ross Peterson.

Simpson Thacher is representing the Special Committee of the Board of Directors of GGP Inc. with a team including Alan Klein (Picture), Jakob Rendtorff, Mark Viera, Sung Jin and Katherine Smith (M&A); Gregory Ressa, Krista Miniutti and Kat Christoforatos (Real Estate); Rob Holo, Nancy Mehlman and Pierce Pandolph (Tax); Greg Grogan and Alina Grinman (Executive Compensation and Employee Benefits); Andy Keller, Roxane Reardon and Lia Toback (Capital Markets); and Alden Millard and Eli Isak (Banking & Credit).

 

Involved fees earner: Alan Klein – Simpson Thacher & Bartlett; Jakob Rendtorff – Simpson Thacher & Bartlett; Mark Viera – Simpson Thacher & Bartlett; Sung Jin – Simpson Thacher & Bartlett; Gregory Ressa – Simpson Thacher & Bartlett; Krista Miniutti – Simpson Thacher & Bartlett; Robert Holo – Simpson Thacher & Bartlett; Nancy Mehlman – Simpson Thacher & Bartlett; Pierce Pandolph – Simpson Thacher & Bartlett; Gregory Grogan – Simpson Thacher & Bartlett; Alina Grinman – Simpson Thacher & Bartlett; Andrew Keller – Simpson Thacher & Bartlett; Roxane Reardon – Simpson Thacher & Bartlett; Lia Toback – Simpson Thacher & Bartlett; Alden Millard – Simpson Thacher & Bartlett; Eli Isak – Simpson Thacher & Bartlett; Mark Kirshenbaum – Goodwin Procter; Jason Vollbracht – Goodwin Procter; Adam Romig – Goodwin Procter; Ross Peterson – Goodwin Procter; Gilbert Menna – Goodwin Procter; Mark Opper – Goodwin Procter; Daniel Adams – Goodwin Procter; David Roberts – Goodwin Procter; Christopher Versfelt – Goodwin Procter; David Roberts – Goodwin Procter; Caitlin Tompkins – Goodwin Procter;

Law Firms: Simpson Thacher & Bartlett; Goodwin Procter;

Clients: Brookfield Property Partners L.P.; GGP Inc.;

 

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Author: Ambrogio Visconti