Developer Mills to Sell Stake in Foreign Malls

Cash-strapped mall developer Mills Corp., owner of Ontario Mills mall in San Bernardino County, announced plans Monday to sell its interest in three malls in foreign countries.

The Arlington, Va.-based company will get $981 million from buyer Ivanhoe Cambridge for its stake in Vaughan Mills in Ontario, Canada; St. Enoch Centre in Glasgow, Scotland; and Madrid Xanadu in Madrid.

But the company expects to net only about $500 million from the sale after paying project costs and relieving some debt.

Last week, Mills’ shares plunged after auditors questioned the company’s financial viability and the company announced a series of accounting write-downs and problems with its Xanadu entertainment and retail development under construction at the Meadowlands in New Jersey. That complex is expected to cost more than $2 billion, about $800 million more than previous estimates.

The Securities and Exchange Commission has been investigating the company’s accounting practices since March.

Its shares rose $1.53, or 9.6%, to $17.44, down from a 52-week high of $59.98 in September.

Company spokesman David Douglass did not return calls seeking comment. In February, Mills said it was exploring strategic alternatives, including a sale of all or part of the company.