Rodamco investors OK sale of assets

Rouse, one of buyers, to acquire stake in eight upscale malls

March 26, 2002|By Meredith Cohn | Meredith Cohn,SUN STAFF

Ending a takeover battle that began last summer, shareholders of a Dutch shopping mall company agreed yesterday to sell 35 U.S. properties to three companies, including the Rouse Co., for $5.3 billion.

Columbia-based Rouse will gain control of all or part of eight malls, considered some of the most upscale in the nation, as part of the deal.

The other two buyers of Rodamco North America NV's assets are Westfield America Trust and Simon Property Group Inc. The deal will dissolve Rodamco and boost the holdings of the buyers, among the United States' largest shopping mall owners.

"It was always our expectation that if the shareholders were able to vote in favor of the deal they would," said David L. Tripp, a Rouse vice president and director of investor relations.

Tripp said a shareholder vote at Rouse is not required, and the company foresees no other issues hampering the sale, expected to close in early May.

The battle for control of Rodamco began in August, when Westfield bought a 24 percent stake in Rodamco and sought to oust its management. Rodamco's efforts to stave off the takeover and supplement executives' pay in the event of a sale sparked a lawsuit charging mismanagement by a shareholders' group.

Rodamco, in the meantime, brought in Rouse and Simon, who negotiated directly with Westfield to split up the company.

The lawsuit proceeded, and the Enterprise Chamber of the Amsterdam Court of Appeal ruled March 22 that there was mismanagement at Rodamco and rejected the executive pay packages that would have shrunk the amount of money paid to shareholders. But the court allowed the shareholder vote on the three-way deal to happen yesterday.

The buyers and analysts have said the deal is so large that shareholders would not have found companies willing to pay more for the assets, which also include a management company and other properties that will be divided among the buyers.

Shareholders apparently agreed. About 88 percent of the shareholders voting at yesterday's meeting in the Netherlands supported the deal, according to Rodamco.

"This was an opportunity for all shareholders to exit [Rodamco] at an attractive premium," Gerald Egan, chairman of the company's management board, said in a statement. "I am delighted that shareholders approved our proposals with such overwhelming support."

Only Westfield says its shareholders need to vote on various aspects of the deal. A meeting is expected in April.

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