Playing on the escalator

27 March 2018 By Lauren Silva Laughlin Follow @TheRealLSL

The real-estate owner raised the headline value of its offer for the U.S. shopping-center operator to $15.3 bln. Yet the fall in Brookfield’s shares since it first made a bid makes the new offer look worse. Split the difference, and Brookfield is probably being rational.

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Brookfield Property Partners made a revised offer on March 26 for the 66 percent of shopping mall company GGP that it does not already own.

The company said it would pay to $23.50 a share, or $15.3 billion, to GGP shareholders, up from the previous offer of $23, with a partial share alternative. The total amount payable would be just under $9.3 billion of cash, and 254 million units of Brookfield Property stock.

Brookfield will also create a new real-estate investment trust that mirrors its stock but is treated differently for tax purposes. GGP is currently structured as a REIT.

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