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General Growth Properties Inc (NYSE:GGP) on Monday slammed Bill Ackman’s efforts to influence a sale. Bill Ackman, the activist shareholder, has been advocating for a sale recently.

General Growth Properties Inc (NYSE:GGP) turned down Ackman’s efforts, stating that the company had made notable gains ever since leaving bankruptcy protection back in 2010. General Growth Properties argues that these notable gains signal its ability further improve as a stand-alone company.

The letter from GGP states, “After reviewing your letters and giving the matters you raised serious consideration, the board has unanimously determined that the best value for all shareholders will be achieved by GGP continuing to execute on its well conceived business plan”.

Speculation is that the board’s decision to halt proceeds with regards to pushing forward for sales was influenced by far greater factors. It seemingly appears as if the board wanted to quell a possible bidding war between the company’s biggest shareholder, Brookfield Asset Management Inc. (NYSE:BAM) (TSE:BAM.A) and its bigger rival, Simon Property Group, Inc (NYSE:SPG)

Brookfield Asset Management Inc. (NYSE:BAM) (TSE:BAM.A) currently owns an estimated 42 percent of General Growth’s shares.

Interestingly, Ackman has a slant towards Brookfield’s rival Simon Property Group, Inc (NYSE:SPG). This is despite the fact that Ackman played an instrumental role in making Brookfield Asset Management Inc.(NYSE:BAM) (TSE:BAM.A) the lead shareholder as part of the recapitalization plan. Now Ackman argues that General Growth shareholders will be better off under Simon Property Group.

Ackman’s intentions to push forward with a sale to Simon, has been in the open ever since late August when the activist shareholder sent two letters to the General Growth Properties board. The letters, which were later filed with the SEC as public documents, highlighted how Ackman had witnessed renewed interests in Simon last year after an initial bid to buy General Growth Properties Inc (NYSE:GGP) as a bad option for shareholders.

Known for his persistence, Ackman will not back down from the matter that quickly- at least this is what Green Street Advisors Inc analyst Cedrik Lechance believes. It is unlikely for someone like Bill Ackman that this would signify the end of the process that he’s been attempting to put together,” he notes.

Ackman’s Perishing Square Capital Management currently has approximately an 11 percent stake at General Growth Property.

 

CitiGroup research notes one possible outcome as follows:

SPG is unlikely to want to increase the risk profile of its balance sheet and negatively impact its cost of capital, particularly as
SPG has desires to grow its offshore exposure . On our estimates, SPG could do a $24 stock offer for GGP which would be earnings and leverage neutral. However, the deal would come with execution risk. SPG would need to raise ~$2bn of equity and sell ~$6bn of mall assets (or use JV capital). A deal at $23 would give some slight accretion to earnings, though with GGP currently at $20.60 there might not be enough of a takeover premium for GGP shareholders. In addition, SPG would need to reduce the level of secured debt on balance sheet.