| Wed 15 Dec 2010, 9:51 | | GEN - Simon Property Group Inc. (Simon) submits indicative proposal of 425 |
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JSE
GEN
GEN - Simon Property Group, Inc. ("Simon") submits indicative proposal of 425
pence per share in cash to Capital Shopping Centres Group Plc ("CSC")
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN, INTO OR
FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE
RELEVANT LAWS OF SUCH JURISDICTION
For immediate release
Simon Property Group, Inc.
December 15, 2010
This announcement is being made in accordance with Rule 2.4 of the City Code on
Takeovers and Mergers (the "Code"). This announcement does not constitute an
announcement of a firm intention to make an offer under Rule 2.5 of the Code.
There can be no certainty that any offer will ultimately be made.
SIMON PROPERTY GROUP, INC. ("SIMON") SUBMITS INDICATIVE PROPOSAL OF 425 PENCE
PER SHARE IN CASH TO CAPITAL SHOPPING CENTRES GROUP PLC ("CSC")
Simon announces that it has today sent a letter, the text of which is set out
below, to the Board of CSC. The letter contains the terms of an indicative
proposal of 425 pence per share in cash for the shares of CSC`s other
shareholders.
The letter does not constitute an announcement of a firm intention to make an
offer under Rule 2.5 of the Code. There can be no certainty that any offer will
ultimately be made.
LETTER TO THE BOARD OF CSC
December 15, 2010
The Board of Directors
Capital Shopping Centres Group PLC
40 Broadway
London
SW1H 0BT
Dear Sirs/Madam,
Indicative offer for Capital Shopping Centres Group PLC ("CSC")
I am writing to propose a transaction in which Simon Property Group, Inc.
("Simon") would offer CSC`s other shareholders 425 pence in cash per ordinary
share.
Our interest in making an offer for CSC is, of course, not new. By making this
offer on the terms outlined in this letter, we are confident that we have now
answered any objections you have previously expressed. We believe that we
should work together to announce a recommended offer, and would urge you to
listen to calls from your shareholders - many of whom we have spoken to -
opposing the Trafford Centre transaction or asking you to adjourn your
forthcoming EGM.
Benefits of our proposal
We believe that our proposal provides a full and fair premium valuation to CSC
shareholders. A cash offer of 425 pence per CSC share would represent:
- a premium of 26% to CSC`s closing share price of 337 pence immediately
prior to the commencement of the offer period on November 24, 2010;
- a premium of 21% to CSC`s average daily closing price over the 6 month
period prior to commencement of the offer period on November 24, 2010;
- a premium of 16% to the blended share price of 367 pence at which CSC is
proposing to issue 25% of the company`s shares to Peel to fund the acquisition
of the Trafford Centre;
- a premium of 13% to CSC`s diluted NAV per share of 377 pence as of November
1, 2010; and
- a premium of 7% to CSC`s closing share price of 396 pence on December 14,
2010, the day before the date of this letter.
Financing
Simon is an S&P 500 company with an equity market capitalisation of
approximately US$34 billion. We have completed real estate acquisitions with an
aggregate value of US$28 billion. We are finalising a bridge loan facility with
our bankers of approximately GBP3 billion for the purposes of this transaction.
We are confident that, subject to successful completion of due diligence, we
will be able to obtain sufficient resources to satisfy our proposal in full.
Pre-conditions
The announcement of a firm offer under Rule 2.5 of The City Code on Takeovers
and Mergers ("The City Code") would be subject to the following pre-conditions
(none of which we will waive):
- the proposed acquisition of the Trafford Centre Group not having been
completed;
- final approval from the board of Simon; and
- access to satisfactory due diligence.
Any formal offer would also be subject to the normal terms and conditions
appropriate to an offer under The City Code.
We reserve the right to announce a firm offer under Rule 2.5 of The City Code
(i) at less than 425 pence per CSC share (a) if the directors of CSC agree or
(b) by an amount of up to any dividend declared, made or paid after the date of
this letter; and/or (ii) including (an) alternative form(s) of consideration.
Advisers
We have appointed Citi, Lazard and Evercore as our financial advisers and
Freshfields and Wachtell Lipton as our legal advisers.
Status and announcement
This letter, and any non-contractual obligation arising from or relating to it,
is governed by and construed in accordance with English law, and is not intended
to be legally binding and shall not give rise to any legal consequences in any
respect. We must emphasise that this letter does not constitute an offer (or
impose any obligation to make an offer) nor does it evidence a firm intention on
our part to make a formal offer for CSC for the purposes of Rule 2.2(a) of The
City Code or otherwise and we reserve the right to terminate our interest in CSC
immediately at any stage and without reason.
We shall be publicly announcing the contents of this letter.
Conclusion
We believe that our proposed offer is highly favourable and attractive to CSC
shareholders. We are enthusiastic about this opportunity and committed to
dedicating substantial time and financial resources with a view to concluding a
transaction as soon as possible.
If you need any further clarification, please do not hesitate to contact me or
our financial advisers.
Yours faithfully,
David Simon
Chairman of the Board and Chief Executive Officer
Enquiries:
Simon
Shelly Doran (Investors) Telephone: +1 317 685 7330
Les Morris (Media) Telephone: +1 317 263 7711
Citi Telephone: +44 (0) 20 7986 4000
(Financial adviser to Simon)
Philip Robert-Tissot
Grant Kernaghan
Charles Lytle
Lazard Telephone: +44 (0) 20 7187 2000
(Financial adviser to Simon)
Jeffrey Rosen
William Rucker
Patrick Long
Evercore Telephone: +44 (0) 20 7268 2702
(Financial adviser to Simon)
Julian Oakley
Citigate Dewe Rogerson Telephone: +44 (0) 20 7638 9571
(UK media adviser to Simon)
Grant Ringshaw
Patrick Donovan
Tom Baldock
Sard Verbinnen & Co Telephone: +1 212 687 8080
(US media adviser to Simon)
Hugh Burns
Brooke Gordon
Nathaniel Garnick
Citi, which is authorised and regulated in the United Kingdom by the Financial
Services Authority, is acting for Simon and no one else in relation to the
matters referred to in this announcement and will not be responsible to anyone
other than Simon for providing the protections afforded to customers of Citi or
for providing advice in relation to the contents of this announcement.
Lazard & Co., which is authorised and regulated in the United Kingdom by the
Financial Services Authority, is acting for Simon and no one else in relation to
the matters referred to in this announcement, and will not be responsible to
anyone other than Simon for providing the protections afforded to customers of
Lazard & Co. or for providing advice in relation to the contents of this
announcement.
Evercore Partners, which is authorised and regulated in the United Kingdom by
the Financial Services Authority, is acting for Simon and no one else in
relation to the matters referred to in this announcement and will not be
responsible to anyone other than Simon for providing the protections afforded to
customers of Evercore Partners or for providing advice in relation to the
contents of this announcement.
Forward looking statements
This announcement contains certain "forward looking statements". These
statements are based on the current expectations of the management of Simon and
are naturally subject to uncertainty and changes in circumstances. The forward-
looking statements contained in this announcement include statements relating to
the expected effects of the Acquisition on CSC, the expected timing and scope of
the Acquisition, and other statements other than historical facts.
Forward-looking statements include statements typically containing words such as
"will", "may", "should", "believe", "intends", "expects", "anticipates",
"targets", "estimates" and words of similar import. Although Simon believes
that the expectations reflected in such forward-looking statements are
reasonable, Simon can give no assurance that such expectations will prove to be
correct. By their nature, forward-looking statements involve risk and
uncertainty because they relate to events and depend on circumstances that will
occur in the future. There are a number of factors that could cause actual
results and developments to differ materially from those expressed or implied by
such forward looking statements. These factors include: local and global
political and economic conditions; changes in UK real estate market conditions
and valuations; competitors` actions; foreign exchange rate fluctuations and
interest rate fluctuations (including those from any potential credit rating
decline); legal or regulatory developments and changes; the outcome of any
litigation; the impact of any acquisitions or similar transactions; success of
business and operating initiatives; and changes in the level of capital
investment. Other unknown or unpredictable factors could cause actual results
to differ materially from those in the forward-looking statements.
Given these risks and uncertainties, investors should not place undue reliance
on forward-looking statements as a prediction of actual results. Neither Simon
nor any of its affiliated companies undertakes any obligation to update or
revise forward-looking statements, whether as a result of new information,
future events or otherwise, except to the extent legally required.
Dealing Disclosure Requirements
Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any
class of relevant securities of an offeree company or of any paper offeror
(being any offeror other than an offeror in respect of which it has been
announced that its offer is, or is likely to be, solely in cash) must make an
Opening Position Disclosure following the commencement of the offer period and,
if later, following the announcement in which any paper offeror is first
identified. An Opening Position Disclosure must contain details of the person`s
interests and short positions in, and rights to subscribe for, any relevant
securities of each of (i) the offeree company and (ii) any paper offeror(s). An
Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made
by no later than 3.30 pm (London time) on the 10th business day following the
commencement of the offer period and, if appropriate, by no later than 3.30 pm
(London time) on the 10th business day following the announcement in which any
paper offeror is first identified. Relevant persons who deal in the relevant
securities of the offeree company or of a paper offeror prior to the deadline
for making an Opening Position Disclosure must instead make a Dealing
Disclosure.
Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1%
or more of any class of relevant securities of the offeree company or of any
paper offeror must make a Dealing Disclosure if the person deals in any relevant
securities of the offeree company or of any paper offeror. A Dealing Disclosure
must contain details of the dealing concerned and of the person`s interests and
short positions in, and rights to subscribe for, any relevant securities of each
of (i) the offeree company and (ii) any paper offeror, save to the extent that
these details have previously been disclosed under Rule 8. A Dealing Disclosure
by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm
(London time) on the business day following the date of the relevant dealing.
If two or more persons act together pursuant to an agreement or understanding,
whether formal or informal, to acquire or control an interest in relevant
securities of an offeree company or a paper offeror, they will be deemed to be a
single person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree company and by any
offeror and Dealing Disclosures must also be made by the offeree company, by any
offeror and by any persons acting in concert with any of them (see Rules 8.1,
8.2 and 8.4).
Details of the offeree and offeror companies in respect of whose relevant
securities Opening Position Disclosures and Dealing Disclosures must be made can
be found in the Disclosure Table on the Takeover Panel`s website at
www.thetakeoverpanel.org.uk, including details of the number of relevant
securities in issue, when the offer period commenced and when any offeror was
first identified. If you are in any doubt as to whether you are required to make
an Opening Position Disclosure or a Dealing Disclosure, you should contact the
Panel` s Market Surveillance Unit on +44 (0)20 7638 0129.
Date: 15/12/2010 09:51:07 Produced by the JSE SENS Department.
