U.S based commercial real estate company Simon Property Group Inc. (SPG) will be cutting down its purchase price for an 80% stake in fellow real estate investment company Taubman Realty Group (TRG).
During a joint statement the companies said Simon Property will be reducing its purchase price by 18% due to what the companies call distortions in the retail industry sector caused by the coronavirus pandemic.
This agreed discount comes after a legal battle in which Simon Property was threatening to pull out of the deal citing the huge distortion in the retail industry sector courtesy of the pandemic.
Under the renegotiated terms, Simon Property will pay $2.65 billion for 80% stake in Taubman Realty. The new deal cuts down offer price from $53.52 to $43 per share.
“The Taubman family will sell about one-third of its ownership interest at the transaction price, leaving them with a 20% stake in TRG,” said the company.
The companies confirmed having settled a court battle in a Michigan court concerning the merger further saying the deal will be closed late this year or early next year.