Here's the text of the latest missive:
Simon Responds to Inferior and Highly Conditional General Growth Proposal
INDIANAPOLIS, Feb 24, 2010 /PRNewswire via COMTEX/ -- Simon Property Group, Inc. (NYSE: SPG) today issued the following statement in response to the highly conditional recapitalization proposal announced by General Growth Properties, Inc. (OTC: GGWPQ.PK):
"General Growth's proposed recapitalization amounts to a risky equity play on the backs of its unsecured creditors. While continuing to block the immediate and certain 100% cash recovery provided by Simon's offer, General Growth has preempted its own self-proclaimed 'process' in favor of a highly speculative and risky plan to attempt to raise $5.8 billion of new capital in today's uncertain markets -- including $3.3 billion of dilutive new equity, $1 billion in asset sales and $1.5 billion in new debt -- on top of the approximately $28 billion it already owes. Simon is providing $10 billion of real value -- $3 billion to shareholders as well as $7 billion to creditors -- as compared to a complex piece of financial engineering that is so highly conditional as to be illusory."
Simon's offer is far superior to the General Growth proposal in many ways, including:
* $9 billion of cash upfront vs. the General Growth plan which offers only $2 billion in cash and the hope of additional cash down the road, subject to highly uncertain market conditions.
* 100% immediate and certain cash recovery to unsecured creditors vs. the General Growth plan which would likely result in unsecured creditors receiving most of any recovery at some point down the road in the form of equity in a highly leveraged, capital constrained entity. In addition, the inevitable sale of shares by creditors who receive stock would put downward pressure on the value of General Growth shares.
* Cash value to equity holders with no dilution vs. the General Growth plan which would result in significant dilution of General Growth shareholders -- who would be left with two speculative equity securities that are likely to underperform.
* Fully addresses claims of unsecured creditors vs. General Growth's proposal which turns the bankruptcy process on its head by favoring equity holders at the expense of creditors.
* No financing condition vs. the combination of the massive required capital raising and asset sales in the General Growth plan which amount to a financing condition for the majority of potential cash recovery for creditors.
* Potential for equity holders and certain creditors to elect SPG stock in lieu of cash, providing certainty and upside potential in an established equity security of an S&P 500 company that has historically outperformed. Stakeholders who elect SPG stock will be investors in an entity that has enhanced growth prospects through superior management, synergies and access to capital to realize value creation.