Shopping mall giant Simon Property Group Inc. plans to sell
another 20 million shares of common stock to raise money for “general corporate
purposes” in a new attempt to shore up its balance sheet.
The company had announced it was selling 14 million shares
yesterday, but increased the number this morning.
The Indianapolis-based real estate investment trust set a price of
$50 for the offering, which will dilute the value of Simon’s existing 231
million shares. At that price, the offering would raise $1 billion.
Merrill Lynch & Co., J.P. Morgan Securities Inc. and Morgan
Stanley will manage the share sale, the company said. Simon expects to grant
the underwriters an overallotment option to purchase 3 million additional
The move is the most recent attempt to improve the company’s
balance sheet during a tough time for real estate developers. Earlier this
month, the company reduced its dividend to from 90 cents to 60 cents per share.
It now pays the dividend mostly in new shares, not cash, a decision also
designed to preserve liquidity.
sold 17.3 million shares in a common stock offering in March, raising $543.4
million. It also completed a $650 million debt sale earlier in the first
price rose $2.57 this morning, or 4.7 percent, to $52.28 per share.