Simon Property Group Inc., the nation's largest mall owner, said it made its "best and final offer" Friday morning to acquire Santa Monica-based rival Macerich Co., upping the per-share bid to $95.50 from $91.
Simon said its offer, which is unsolicited, will be withdrawn on April 1 if the two companies do not meet by then.
Macerich confirmed it received Simon's offer and said in a statement that its board of directors would review the proposal.
The proposal would combine two of the nation's largest mall owners.
Simon valued Friday's proposal at $16.8 billion, excluding assumption of approximately $6.4 billion of Macerich's debt.
Macerich, owner of Santa Monica Place, rejected a previous unsolicited bid Tuesday from the Indianapolis-based Simon Property, saying at the time that the $16-billion proposal "substantially undervalues" the company.
Simon said Friday all terms of its previous bid will be the same, including consideration in the form of 50% cash and 50% Simon common stock.
In addition to rejecting Simon's first bid, Macerich's board of directors also unanimously approved two governance changes to deter "coercive takeover attempts." These changes include a stockholder rights plan and the adoption of a classified board structure, in which directors would be assigned to one of three classes and serve three-year terms.
In a letter to Macerich Chief Executive Arthur Coppola, Simon Property Chief Executive David Simon said his company will not nominate directors for the Macerich board, "or otherwise prolong this process."
"Macerich's decision to adopt extreme defensive measures is disappointing," said Simon Properties Chief Executive David Simon in a statement. "We have repeatedly expressed our desire to work with Macerich to reach a mutually beneficial agreement and do not believe a protracted, multi-year proxy battle is in the interests of the shareholders of either company.
Simon said there was no financing condition to the proposal and that the company believes there are no legal or other impediments to completing the transaction.
Simon has several Southern California holdings, like Brea Mall, Del Amo Fashion Center in Torrance and Ontario Mills outlet mall. Macerich owns regional malls like the Westside Pavilion in Los Angeles.
Shares of Macerich were down $7.15, or 7.50%, to $86.30. Simon stock was up $2.12, or 1.1%, to $194.22 in early trading.