June 10, 2020
Simon Property Group said Wednesday it had terminated its Feb. 9 merger agreement with Taubman Centers Inc. and had filed suit against Taubman. The agreement valued Taubman at $3.6 billion.
The suit alleges that the COVID-19 pandemic had a “uniquely material and disproportionate effect on Taubman” compared to other operators, and that Taubman breached its obligations related to the operation of its business.
“In particular, Taubman has failed to take steps to mitigate the impact of the pandemic as others in the industry have, including by not making essential cuts in operating expenses and capital expenditures,” according to Simon.
Indianapolis-based Simon cited Taubman’s “significant proportion of enclosed retail properties located in densely populated major metropolitan areas, dependence on both domestic and international tourism at many of its properties, and its focus on high-end shopping.” It said these factors combined to impact Bloomfield Hills, MI-based Taubman’s business disproportionately amid the pandemic, compared to the rest of the retail real estate industry.
A Taubman spokeswoman didn’t respond immediately to Connect Media’s request for comment.
Pictured: Taubman’s Beverly Center in Los Angeles.
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