General Growth Plans Offering to Replace Investor Commitments

General Growth Properties Inc. (GGP) said it expects to pursue a stock offering after it emerges from bankruptcy to replace financing commitments from some investors instead of selling notes that would convert to equity.

The company, the second-largest U.S. mall owner, is planning a post-bankruptcy offering that would replace “a substantial portion” of the shares slated to be issued to an investor group, it said in a filing yesterday in U.S. Bankruptcy Court in Manhattan.

General Growth, based in Chicago, is approaching the end of its bankruptcy case, which started in April 2009. It’s scheduled to seek court approval next month for its plan to exit bankruptcy with financing commitments from Brookfield Asset Management Inc. (BAM), Fairholme Capital Management LLC and Pershing Square Capital Management LP.

General Growth has the right to replace portions of the investors’ equity commitments through a public offering of notes that convert to shares or through a post-bankruptcy public stock offering, according to court papers.

General Growth has an underwriting agreement from Goldman & Sachs Co. (GS), Deutsche Bank AG (DB), Wells Fargo Securities (WFC), RBC Capital Markets Corp., Barclays PLC (BARC), UBS Securities LLC, Macquarie Bank Ltd. and TD Securities (USA) LLC.

General Growth also has exit-financing commitments of as much as $1.8 billion in loans, according to the court filing.

The case is In re General Growth Properties Inc., 09-11977, U.S. Bankruptcy Court, Southern District of New York (Manhattan).

To contact the reporter on this story: David McLaughlin in New York at

To contact the editor responsible for this story: David E. Rovella at

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