General Growth Properties has completed its $12.6bn acquisition of The Rouse Company, in the largest US REIT M&A transaction in history. Deutsche Bank acted as Financial Advisor to Rouse.
In this all-cash transaction, Rouse shareholders receive $67.50 per share, representing an offer premium of 33.4% to the stock’s closing price prior to announcement ($50.61). Rouse, one of the preeminent developers and managers of shopping malls and planned communities in the U.S., had ownership interests in 37 regional malls, 4 community centers and 6 mixed-use projects, totaling approx. 40m sf, a portfolio of office, industrial and other commercial properties totaling approx. 9m sf, and one of the countries premier master-planned community development businesses.
General Growth paid $7.2bn in equity and assumed $5.4bn in Rouse debt creating the second largest U.S. REIT with a $32 bn total enterprise value. General Growth financed the deal with a $7.0bn bridge facility (as part of a $9.7 bn financing commitment) and a $500m rights offering to existing shareholders. General Growth will thus have ownership interests in, or management responsibility for, a portfolio of 221 regional shopping malls and numerous other types of properties in 44 states. Its portfolio total approx. 200m sf of space and includes over 16,000 retailers nationwide.
This transaction is indicative of a global trend towards consolidation in the regional shopping center industry.
Source: Deutsche Bank