EXHIBIT 99.1
FOR IMMEDIATE RELEASE
CONTACTS:
Investors Media
Shelly Doran George Sard/Paul Caminiti/Hugh Burns
Simon Property Group, Inc. Citigate Sard Verbinnen
317/685-7330 212/687-8080
SIMON PROPOSES ALL-CASH OFFER
TO ACQUIRE TAUBMAN FOR $17.50 PER SHARE
Price Is Higher Than Taubman Shares Have Ever Traded
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INDIANAPOLIS, November 13, 2002 - Simon Property Group, Inc. (NYSE: SPG) today
made a written offer to acquire Taubman Centers, Inc. (NYSE: TCO) for $17.50 per
share in cash, a substantial current premium and a price higher than Taubman
Centers shares have ever traded. The letter sent today to the Board of Directors
of Taubman Centers by David Simon, Chief Executive Officer of Simon Property
Group, follows:
Dear Members of the Board of Directors:
As you may know, we recently made a written offer to Robert S. Taubman to pay
$17.50 in cash for each share of Taubman Centers, Inc. (the "Company") common
stock. Our all-cash offer would deliver to all Taubman shareholders a
substantial premium -- approximately 18% above yesterday's closing price and 30%
above the price on the day we initially made our offer -- and it exceeds the
highest price at which Taubman shares have ever traded. Our offer represents a
compelling strategic and financial transaction that would produce substantial
and immediate value for all of your shareholders. We can move quickly since our
offer is not subject to the receipt of financing or any due diligence
investigation of the Company.
On several occasions, we have communicated our offer to Mr. Taubman and
suggested that we have an opportunity to discuss it with the members of
Taubman's board of directors. We wrote Mr. Taubman on October 16, 2002, to
request a meeting to present our offer. He refused to meet. On October 22, 2002,
we again wrote Mr. Taubman, this time setting forth the basic terms of our
offer. Once again, he refused even to have a discussion, writing to us on
October 28, 2002, that "the Company has no interest whatsoever in pursuing a
sale transaction...."
We are dismayed that Mr. Taubman continues in his refusal even to discuss our
offer - or indeed any sale transaction, particularly in light of the fact that
we have expressed a willingness to be very flexible with respect to the
structure of the proposed transaction. The offer is not conditioned upon any
participation by the Taubman family. Instead we have agreed to accommodate any
desire by the Taubman family to retain its economic interest in the Taubman
Realty Group Limited Partnership, or, at their option, to participate in the
transaction, and receive either cash or equivalent value for their existing
partnership interests by exchanging them on a tax efficient basis for
partnership interests in the Simon operating partnership.
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Since the Taubman family can choose to (1) retain its current Taubman
partnership units, (2) convert into Simon partnership units, or (3) sell for
cash, we can only conclude that Mr. Taubman's refusal even to discuss our offer
reflects the Taubman family's desire not to permit the Company to be sold under
any circumstances. While it is entirely appropriate for the Taubman family to
retain the right to choose between various options with respect to the treatment
of its own partnership units, it is improper for these insiders to prevent
public shareholders from choosing to receive a premium for their shares.
Mr. Taubman apparently believes the Taubman family is not accountable to the
public shareholders because of the family's claimed blocking position - via the
Series B preferred stock - which was surreptitiously issued in a "restructuring"
transaction many years after the Company's initial public offering without
either proper disclosure or a shareholder vote. We question both the propriety
and validity of a transaction which attempts to transfer to the Taubman family
control and a permanent veto over material decisions that rightfully belong to
the public shareholders of Taubman - such as an all-cash, premium offer to
acquire the Company.
The effect of the Series B preferred stock, for which the Taubman family paid a
total of only $38,400.00, is to disenfranchise the public shareholders. This
entrenchment device is a permanent corporate governance defect embedded in the
Company's structure - and it continues to hurt the public shareholders. Indeed,
between the time the Series B shares were issued to the Taubman family in 1998
and our October 22 offer letter, the price of Taubman common shares has fallen
by 4%.
We understand that the obstacles created in the governance structure by the
Taubman family, at the expense of the public shareholders, are significant.
However, with the cooperation of the Board of Directors, acting as fiduciaries
for the common shareholders, we believe these obstacles are surmountable. We
also trust that undisclosed economic or governance burdens have not been, and
will not be, imposed on Taubman in response to our offer or otherwise.
We hope the Board will agree with us that our offer provides an excellent
opportunity for Taubman shareholders to realize immediate liquidity and full
value for their shares to an extent not likely to be available to them in the
marketplace or in any alternative transaction. At a time when good corporate
governance is particularly important to investors, we seek your help in
restoring the rights of the public shareholders of Taubman.
We prefer to complete this acquisition through a negotiated transaction. We
stand ready to make a detailed presentation of our offer to the Board and to
answer any questions you may have.
Very truly yours,
David Simon
Chief Executive Officer
* * *
Shareholders may visit the corporate information tab on www.shopsimon.com for
additional information regarding Simon's proposed offer to acquire Taubman.
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About Simon
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Headquartered in Indianapolis, Indiana, Simon is a real estate investment trust
engaged in the ownership and management of income-producing properties,
primarily regional malls and community shopping centers. Through its subsidiary
partnerships, it currently owns or has an interest in 249 properties containing
an aggregate of 185.8 million square feet of gross leasable area in 36 states,
as well as eight assets in Europe and Canada and ownership interests in other
real estate assets. Additional Simon information is available at
www.shopsimon.com
# # #
This news release is for informational purposes only and is not an offer to buy
or the solicitation of an offer to sell any Taubman shares, and is not a
solicitation of a proxy.
Forward-looking statements
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This release contains some forward-looking statements as defined by the federal
securities laws which are based on our current expectations and assumptions,
which are subject to a number of risks and uncertainties that could cause actual
results to differ materially from those anticipated, projected or implied. We
undertake no obligation to publicly update any forward-looking statements,
whether as a result of new information, future events or otherwise.