General Growth: BAM, Berkowitz, Ackman, FUR?

[txlaw]

Didn't see any postings on this yet.  See the following articles:

 

Ackman May Make $170 Million on ‘Grand Slam’ General Growth Bet

http://www.businessweek.com/news/2010-02-18/ackman-may-make-170-million-on-grand-slam-general-growth-bet.html

 

Fairholme's Berkowitz Weighs in on Simon's bid for General Growth Properties

http://news.morningstar.com/articlenet/article.aspx?id=327031

 

Brookfield to Battle Simon for Mall Giant

http://online.wsj.com/article/SB10001424052748704454304575081943861666942.html (access for WSJ premium members)

 

Brookfield Said to Seek 30% Stake in General Growth

http://www.businessweek.com/news/2010-02-23/brookfield-said-to-be-in-talks-for-30-stake-in-general-growth.html

 

It looks like GGP could exit bankruptcy as a stand alone company with some of its unsecured debt converted to equity. 

 

If Michael Ashner is as good a real estate investor as people think he is (including me), I have to wonder how FUR is participating in this blockbuster battle.

[dcollon]

More on GGP

 

http://www.bloomberg.com/apps/news?pid=20601087&sid=aK6eANTku_R0&pos=5

 

[dcollon]

New developments in GGP

 

http://www.bloomberg.com/apps/news?pid=20601087&sid=aQQTy82Hoc9s&pos=3

 

[txlaw]

New developments in GGP

 

http://www.bloomberg.com/apps/news?pid=20601087&sid=aQQTy82Hoc9s&pos=3

 

 

Very interesting.  Thanks for keeping us updated. 

[txlaw]

Even more new developments:

 

http://www.bloomberg.com/apps/news?pid=20601087&sid=aNHg2cyO6dLA&pos=7

http://www.gurufocus.com/news.php?id=86953

[dcollon]

Thanks Txlaw.  I'm hoping some of this ends up in Fairholme's new Income Fund. 

 

 

[netnet]

WSJ article on convert purchase:

 

http://online.wsj.com/article/SB10001424052748703954904575110102914237396.html

 

General Growth Debt Bet Pays Off

 

By GINA CHON

Bloomberg News

 

With assets like the South Street Seaport in New York, shown last month, General Growth Properties was seen by some investors as worth a flier. With General Growth convertible bonds trading as low as three cents on the dollar in late 2008, those who got in have seen heady returns.

 

Going bargain hunting at the mall has rarely been so rewarding.

 

When the nation's second-biggest mall owner was tumbling toward bankruptcy near the end of 2008, a handful of investors dug to the bottom of the discount bin and snapped up the company's convertible bonds at three cents on the dollar.

[GGP] Bloomberg News

 

Today, these General Growth Properties Inc. bonds are worth 103 cents—one of the great trades of the financial crisis.

 

The return is "almost nonsensical," says William Welnhofer of investment firm Robert W. Baird & Co., which wasn't a buyer.

 

Shares of General Growth, which itself is still under bankruptcy protection, also have proved a home run, hitting a low of 32 cents and closing at $14.08 on Monday. After being delisted last year, the shares were relisted on the New York Stock Exchange on Friday.

[dcollon]

It looks like Blackstone is trying to get involved with General Growth

 

http://www.bloomberg.com/apps/news?pid=20601087&sid=a_d8gIwzFTus&pos=7

 

[bttmline]

dcollon. Portion of it will be held at Fairholme and some in the Income Fund, but can't remember the proportion. Blackstone was advising/teaming up with Simon on the GGP deal and when the bankruptcy judge ruled for BAM/Fairholme/Pershing bid, they backed out on bidding. What the Wall Street Journal alluded to today is that BAM/Fairholme/Pershing played nice with Blackstone and offered 5% of the deal to them, so they wouldn't cause any more trouble. This makes sense to me considering BAM has an existing JV with Blackstone called US Office Fund under their US REIT BPO.