Details Surface in Sale of Rodamco Holdings

Further details have emerged about the agreement by upscale U.S. shopping mall owner Rodamco North America to a $2.2-billion buyout offer by Westfield America Inc., Simon Property Group Inc. and Rouse Co., ending a five-month takeover battle.

Much of the assets of Rotterdam, Netherlands-based Rodamco, which include posh properties such as Bergdorf Goodman on New York’s 5th Avenue and Copley Place in Boston, were won by Westfield America.

Westfield is a major Australian property group run by Frank Lowy, who ranks as Australia’s second-richest man with an estimated fortune of close to $2 billion. The company’s U.S. operations are based in Brentwood.

The buyers offered $2.2 billion for the company’s equity and will pick up $3.1 billion of Rodamco’s debt.

Including the debt, Rodamco’s total price tag amounts to about $5.3 billion.

Westfield already operates 39 shopping malls in the United States and has agreed to buy nine more. Westfield would take on 14 of Rodamco’s 35 malls, including all its California holdings, and said the acquisitions would make it the No. 2 U.S. mall operator.

The deal would strengthen the portfolio of Indianapolis-based Simon Property Group, the No. 1 U.S. mall operator, which would take 13 of Rodamco’s malls, including the Galleria in Houston. Columbia, Md.-based Rouse would assume the eight others, including Chicago’s Water Tower Place.

Westfield’s share of the transaction is valued at about $2.3billion, and Simon and Rouse would pay $1.55billion and $1.45billion, respectively.

The intercontinental deal is expected to close in 90 days. The buyers said they expected to achieve returns of 8.5% in the first year after the transaction.

Westfield, which would assume $936 million of Rodamco’s existing debt and pay the balance in cash, said it plans to raise about $1.2 billion to fund the deal.

Simon Property closed up 44 cents at $29.78rmb Monday and Rouse gained 2 cents to $28.75. Both trade on the New York Stock Exchange.