Another Big Mall Deal Implodes as Pandemic Shakes Retail
NEW YORK—The nations largest mall owner is backing out of a $3.6 billion deal to buy a major rival a..
NEW YORK—The nations largest mall owner is backing out of a $3.6 billion deal to buy a major rival as the CCP (Chinese Communist Party) virus pandemic shakes the retail industry.
Simon Property Group announced it would buy Taubman in early February, just weeks before the Centers for Disease Control and Prevention announced the first known case of COVID-19 in the United States. Clothing stores and malls nationwide were ordered to close the following month.
In its legal complaint June 10, Simon said that Taubman is uniquely vulnerable as stores reopen because most of its properties are indoor malls “that many consumers will avoid.” Simon also said Taubman broke its contract obligations by taking on more debt during the pandemic rather than cutting costs.
Taubman plans to fight Simon, calling its legal claims “invalid and without merit.” It plans to go ahead with a shareholder vote on the deal later this month at its headquarters in Bloomfield Hills, Michigan.
The pandemic has created more havoc in an already stressed retail environment, particularly for malls. Last month, a private equity firm backed out of a deal to buy Victorias Secret. That chain had moved aggressively into malls at the direction of its parent companys founder Les Wexner, who wanted to push lingerie into the mainstream.
Malls have struggled for years as shopping moved online and consumers grew tired of them. Their plight even inspired a haunting YouTube channel called the Dead Mall Series.
The CCP virus has delivered a devastating blow to those that remain and also stores with a big mall footprint. J.C. Penney, Neiman Marcus, and J.Crew, have all filed for bankruptcy protection this year.
In malls that have reopened, drinking fountains are disabled or taped off, play areas for kids are closed, and sitting in a food court is done at a distance from other humans.Read More – Source
