Simon Begins Tender Offer, Sues Taubman

Simon Property Group Inc., Indianapolis, has announced the commencement of a cash tender offer to acquire all the outstanding shares of Taubman Centers Inc., Bloomfield, Mich., at $18 per share and has filed suit against Taubman and its board of directors in federal district court.Taubman, which rejected an earlier Simon offer to acquire it for $17.50 per share, said the latest offer will be evaluated by its board, and shareholders will be advised of the board's view within 10 business days. Simon said $18 per share represents a premium of approximately 35% to the price of Taubman shares at the time of Simon's first acquisition proposal and is higher than the shares have ever traded. The newly filed lawsuit maintains, among other things, that Taubman's board is breaching its fiduciary duty by not giving "adequate consideration" to Simon's original offer and by accepting "the Taubman family's claimed veto power over the offer." The two real estate investment trusts traded insults after the previous Simon offer, with Simon contending that certain preferred shares were improperly obtained by the Taubman family in 1998 without a shareholder vote, and Taubman replying with a denial and an assertion that Simon had made "numerous and repeated misleading statements" about Taubman's 1998 restructuring. The REITs can be found online at http://www.taubman.com and http://www.simon.com.