US mall operators Simon Property Group and Taubman Centers have called off their planned merger, citing the impact of Covid-19 on the retail industry.
Simon was to buy an 80-per-cent interest in Taubman, with the Taubman family retaining a 20 percent stake in a US$3.6 billion deal. Taubman owns, manages and/or leases 23 super-regional shopping centres in the US and three in Asia via its Hong Kong-headquartered Taubman Asia business.
Simon says it was pulling out of the deal because it believed Taubman’s properties were “disproportionately hurt” by the pandemic due to their location in densely populated cities and tourist locations and had high-end tenants whose sales had been hit particularly hard this year.
However, Taubman has indicated it will fight to protect the deal, arguing the decision was without merit and plans seek damages from Simon.
The Asian properties which would have been part of the merger are the Starfield Hanam in South Korea, and the Chinese properties CityOn Xi’an and CityOn Zhengzhou.
