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16 April, 2009

Major Mall Maneuver

General Growth Properties Inc, the second largest U.S. mall owner, filed for bankruptcy protection on Thursday in one of the biggest real estate failures in U.S. history. Ending months of speculation, the Chicago-based mall owner, which listed total assets of $29.56 billion and total debts of $27.29 billion, sought Chapter 11 bankruptcy protection from creditors along with 158 of its more than 200 U.S. malls. General Growth's filing in the U.S. bankruptcy court in Manhattan makes it one of the largest non financial companies to succumb to the financial crisis in the U.S.

As of the end of 2008, General Growth had $1.18 billion in past due debt and an additional $4.09 billion of debt that could be accelerated by its lenders. "Our core business remains sound and is performing well with stable cash flows," General Growth Chief Executive Adam Metz said in a statement. The hedge fund run by William Ackman also owns about 25% of General Growth Shares. Ackman, who has been urging General Growth to file for bankruptcy protection, described it as "a great company" with "phenomenal assets" at a conference on April 2. Ackman's Pershing Square Capital Management LP will provide General Growth with $375 million in financing to help run the company during the Chapter 11 process.

The Chicago-based company started when brothers Martin and Matthew Bucksbaum decided to expand the family grocery business and build a shopping center in Cedar Rapids, Iowa, in 1954. General Growth's refinancing troubles in the frozen credit markets led to the firing of former Chief Executive Officer Bernard Freibaum in October. John Bucksbaum, who succeeded his father Matthew in 1999, stepped down as chief executive the same month, although he remained chairman.

Sounds like another scam is developing, as billions in "bailout" money might come their way.
Rig the game, right Mr. Ackman?

1 comment:

  1. It's all going down. But it's part of the plan. The zombies will break into the malls across America and watch TV, try on earrings, play on the escalators, and eat each other for lunch. It's a perfect happy ending for all.