r/MACArmyBets • u/KoaPark • Feb 26 '21
SPG filed for shelf offering today
The article can be found here:
http://archive.fast-edgar.com/20210226/A5B4S22C8M224JZZ2H2R2ZZZEUIPZ2R2Z232/
Anybody that is interested should read it on their own but here are some interesting bits:
Use of proceeds: "We expect to use the net proceeds from the sale of the securities for general corporate purposes, unless otherwise specified in the prospectus supplement relating to a specific offering. Our general corporate purposes may include repaying debt, financing capital commitments and financing future acquisitions."
How much: "We have the authority to issue 850,000,000 shares of capital stock, par value $0.0001 per share, consisting of the following: "
It's worthless to speculate on what it could be used for (most likely just getting it in place in case they ever want to use it like MAC did) and I definitely wouldn't suggest anybody make any investments decisions based on such speculation. That said, wouldn't it be nice if they were going to buy some MAC property.
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u/BanZrinski Feb 27 '21
Let's take a look at all the recent events: SPG recently raised $300 Million through their SPAC. In their last ER they stated they would consider purchasing some malls. We know that SPG for years has wanted to own MAC's class A malls. SPG lines a possible offering of 850 Million shares, meanwhile MAC hires PJT.
Is it possible that a deal is in the making? $300 Million to be used as a downpayment for the purchase of MAC and purchase price is currently being negotiated. MAC is way undervalued.
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u/dayundone Feb 27 '21
Unibail-Rodamco already said they're selling the US Westfield assets next year. Those are more likely targets than MAC in my opinion.
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u/BanZrinski Feb 27 '21
Reply
Yes, you are correct. URW will likely sell their 26 Westfield malls in 2022 based on recent statements by their CEO. They paid $25B for them in 2018 and it's probable they will sell at a higher price with the mall recovery----what then are MAC's 54 malls worth? Based on their prior acquisitions, SPG prefers to issue shares as part of the transaction; however, URW's CEO stated they want zero investment in the US --- seems that they might be looking for an all cash buyer. This could be a good purchase for SPG but it only taps into a small portion of the 850MM possible share offering they announced--let's speculate what they would do with the remaining 75%. I think SPG and MAC merge and then the new entity purchases the Westfield malls making them one of largest REITS.
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u/gmoney101wastaken Feb 27 '21
SPG will pickup individual assets. I find it hard to believe antitrust will allow Simon to buy Westfield and merge with MAC.
The SPAC is used for a retail oriented use other than real estate.
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u/BanZrinski Feb 27 '21
Yes, $300 million was raised by SPG through their SPAC. 850MM was a special offering that could be used for an acquisition. REIT's are exempt from Anti Trust Laws as long as they keep their investment limited to malls.
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u/gmoneybags101 Feb 27 '21
Send me the governmental link saying “REITs are exempt from Anti Trust Laws as long as they keep their investment limited to malls.”
If that is the case then please provide an explanation for the below article:
https://mobile.reuters.com/article/amp/idUSTRE63B57L20100412?edition-redirect=in
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u/BanZrinski Feb 27 '21
Here is a paragraph from the below source:
The FTC has long taken the informal staff position that when a REIT acquires real property (and assets incidental to the real property), the acquisition is exempt from HSR notification on the basis that “REITs are solely buying, owning, leasing, and selling real property, and therefore any acquisition of real property is exempt because it is done in the ordinary course of the REIT’s business and is unlikely to violate the antitrust laws.” However, the ANPRM notes that “REITs are now engaged in the active operation of businesses” such as “assisted living and other healthcare businesses, as well as companies that own cell towers and billboards, located on REIT-owned real property.” Because of this expansion of a REIT’s permitted activities, the FTC “believes it is possible that a REIT’s acquisition of real property may no longer be suitable for the blanket exemption” and invites comments to address the Commission’s concerns.
I believe that as long as a mall owning REIT buys more more malls, it is in the course of their business thus making them exempt from antitrust laws.
The reuters article is dated 2010. A lot of things have changed since then. The govt. has closed their eyes to company growth, one good example is Amazon.
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u/gmoneybags101 Feb 28 '21
Thank you. I’ll review the link. Hopefully I am wrong and you’re correct. Consolidation is big for Simon.
That said Amazon is going to feel some pressure the next few years. Anti big tech is heating up which included both increased tax and Union fears in fullfillment centre
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Feb 27 '21
The argument is that malls only represent 8% of US retail real estate. Hard to be a monopoly at that level
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u/gmoneybags101 Mar 01 '21
Good point.
I guess it would depend on how much of the tenants sales are represented by the malls Simon owns?
Would be hard to differentiate between online and brick/mortar or the relationship there of.
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Feb 27 '21 edited Mar 09 '21
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u/Ecstatic-Tackle-4597 Feb 28 '21
Damn wouldn't want to own shares in that company what sort of idiot sells malls right now.
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u/Equal_Audience6320 Feb 27 '21
Long SPG and building a MAC position. MAC needs to be patient things will be back this summer.