2020 YEAR IN REVIEW: Pandemic whipsaws shopping mall giant

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Simon Property Group went on the offensive in 2020, even as the pandemic emptied its shopping malls, strained its tenants and caused its stock price to tumble.

The Indianapolis-based company closed the year by negotiating a lower price for its purchase of Michigan-based mall rival Taubman Centers Inc.

Simon agreed in February to pay $3.6 billion in cash for 80% of Taubman. But it announced in June it was pulling out of that deal, arguing that the pandemic had triggered “material adverse effect” language in the merger agreement.

Taubman disagreed, but Simon sued, seeking a court declaration validating its right to walk away from the transaction.

On Nov. 15, one day before the trial in that case was set to begin, the companies settled, with Taubman agreeing to accept $656 million, or 20% less than required in the original deal.

Also in 2020, Simon went on a retailer buying spree, purchasing a string of brands out of bankruptcy court. In partnership with other companies, Simon acquired J.C. Penney, Brooks Brothers, Lucky Brand and Forever 21.

Simon argued that the prices were so low that it was well-positioned to make the purchases profitable. The deals also served as a vote of confidence in brick-and-mortar retail, which continued to fall out of favor as the pandemic caused more shoppers to buy online.

But the challenging environment rattled investors. When the pandemic hit in March, Simon shares plummeted and never recovered. For the year, Simon stock was down nearly 50%.

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