Simon Property subsidiary gets tenders for $2.29 billion of notes

By Angela McDaniels

Tacoma, Wash., Jan. 21 - Simon Property Group, Inc.'s operating partnership subsidiary, Simon Property Group, LP, received tenders for $2,285,000,000 of notes, according to a company news release.

A tender offer for seven series of notes issued by the operating partnership and three series of notes issued by CPG Partners, LP began Jan. 12 and expired at 5 p.m. ET on Jan. 20.

The notes tendered and their purchase prices are noted in the table below. Holders will also receive accrued interest up to but excluding the settlement date, which is expected to be Jan. 25.

The operating partnership will fund the purchase with cash on hand and the proceeds from the sale of $2.25 billion of senior unsecured notes. The offering includes $400 million of 4.2% notes due 2015, $1.25 billion of 5.65% notes due 2020 and $600 million of 6.75% notes due 2040 and is expected to close on Jan. 25.

The notes being purchased in the offer have a weighted average remaining duration of two years and a weighted average coupon of 5.76%. In contrast, the new notes have a weighted average duration of 14.4 years and a weighted average coupon of 5.69%.

The offer was not subject to any minimum tender condition, but it was conditioned on the operating partnership's ability to consummate an offering of senior notes on terms that it found reasonably satisfactory.

The dealer managers for the tender offer were Citigroup Global Markets Inc. (800 558-3745), Morgan Stanley & Co. Inc. (800 624-1808) and RBS Securities Inc. (877 297-9832). The information agent was Global Bondholder Services Corp. (866 470-3900).

Simon is a real estate company based in Indianapolis.

Simon Property Group tender offer

Notes Purchase price Amount to be purchased

Simon Property Group, LP notes

$200 million 7.75% of notes due 2011 $1,065.00 $122,361,000

$500 million 5.375% notes due 2011 $1,052.50 $379,978,000

$600 million 5.6% notes due 2011 $1,062.50 $498,603,000

$600 million 5% notes due 2012 $1,062.50 $440,072,000

$400 million 5.75% notes due 2012 $1,077.50 $325,755,000

$350 million 6.35% notes due 2012 $1,100.00 $243,935,000

$200 million 5.45% notes due 2013 $1,077.50 $77,712,000

CPG Partners, LP notes

$150 million 8.25% notes due 2011 $1,072.50 $66,412,000

$100 million 6.875% notes due 2012 $1,105.00 $49,358,000

$150 million 6% notes due 2013 $1,092.50 $80,666,000

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