Simon Property Group proposes $15.3-billion takeover of Macerich

Santa Monica shopping center landlord Macerich Co. is under siege by rival Simon Property Group in a $15.3 billion hostile takeover attempt that could join two of the country’s largest mall owners.

Macerich Co. owns well-known regional malls such as Santa Monica Place in downtown Santa Monica and the Westside Pavilion in Los Angeles.

Indianapolis-based Simon said Monday it had offered Macerich $91 per share in cash and stock for each share of Macerich. The offer represents a 30% premium to Macerich’s closing stock price of $69.88 on Nov. 18, the day before Simon disclosed its 3.6% investment in Macerich.

Macerich itself has been acquiring rivals over the years and still has substantial potential for growth, real estate analyst Craig Silvers said. It recently acquired full ownership of the Fashion Outlets of Chicago and is going to develop the Fashion Outlets of San Francisco at the former site of Candlestick Park.

“I understand why Simon wants Macerich,” said Silvers, president of Bricks & Mortar Capital. “Macerich has a great collection of shopping centers, malls and outlet centers, predominantly in solid and growing markets.”

Simon is the country’s largest mall owner with more than 200 properties in the United States and overseas. Among them are Ontario Mills outlet mall in Ontario, Brea Mall in Brea at the Outlets at Orange in Orange.

Simon said it is taking its offer to shareholders because Macerich Chief Executive Arthur Coppola did not respond to a letter from Simon Chief Executive David Simon.

The bid is valued at $22.4 billion, or $15.3 billion in equity and the assumption of more than $7 billion in Macerich’s debt.

Macerich has 51 malls include properties in Chicago, New York and Washington, D.C.

“Macerich doesn’t have to sell,” Silvers said. “The company has a rock-solid balance sheet and can readily fund its growth.”