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Simon discloses stake in shopping-mall owner Macerich

November 19, 2014

Indianapolis-based Simon Property Group Inc., the biggest U.S. mall owner, said it has accumulated a 3.6-percent stake in rival Macerich Co.

Simon bought 5.71 million shares of Macerich this year and may request that Macerich waive its excess share provision, which restricts stock ownership to 5 percent, the real estate investment trust said Wednesday in a written statement. Simon cited the recent acquisition by another company of a 10.9-percent interest in Santa Monica, California-based Macerich.

The transaction puts Macerich, with its high concentration of West Coast properties, “in play” as a potential takeover candidate, JPMorgan Chase & Co. analysts led by Michael Mueller and Anthony Paolone said in a note to clients Wednesday. The malls would be a good geographic fit for Simon, which has “been quite acquisitive over the years,” they wrote.

“We find it hard to believe that SPG’s move is because it wants to be a passive investor” in Macerich, they wrote, referring to Simon’s ticker symbol.

Macerich said two days ago that it bought the share of five U.S. shopping malls it didn’t already own from a subsidiary of the Ontario Teachers’ Pension Plan Board for $1.89 billion, including the assumption of debt. The purchase price included $1.22 billion of stock issued to the pension plan, or an ownership of almost 11 percent.

Simon shares were down $1.18, or 0.66 percent, in early-morning trading, to $178.01 each.

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