Rodamco mismanaged events before takeover offer, court rules

March 23, 2002|By BLOOMBERG NEWS

AMSTERDAM, Netherlands - Rodamco North America NV executives mismanaged events leading up to a $5.3 billion takeover offer for the fourth-largest U.S. shopping mall owner, a Dutch court said yesterday.

It reversed changes made in the contracts of the company's management board in September that would have guaranteed members higher payouts if Rodamco NA was bought. Management board members can seek to renegotiate the agreements, the court said.

The Amsterdam court was deciding on a complaint from VEB, a Dutch shareholder association, that Rodamco NA's executives mismanaged the real estate investment company, including issuing new shares to a voting trust and granting the higher takeover-related payments.

"The ruling is that RNA committed mismanagement," Judge Huub Willems said.

Rodamco NA, led by Chief Executive Officer Gerald Egan, agreed in January to a three-way takeover by Columbia-based Rouse Co., Westfield America Trust and Simon Property Group Inc. at 55 euros per share. That ended a half-year battle for control of the Dutch real estate company that started in August when Australia's Westfield bought 24 percent of Rodamco NA and tried to oust its management.

A vote by Rodamco NA shareholders, scheduled for Monday, on whether to approve the takeover can proceed, Willems said.

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