"We filed these additional companies under chapter 11 as part of our overall plan to restructure our debt. We do not currently contemplate that additional GGP subsidiaries will file for protection, although it is possible that circumstances could change during the restructuring process," says Adam Metz, CEO of General Growth, in a statement.
The bankruptcy filing is due to the fact that General Growth has $1.12 billion in overdue debt.
During an April 16, 2009 conference call, Metz denied suggestions that the acquisition of the Columbia, Md.-based Rouse Co. in 2004 for $7.2 billion was the main reason for the bankruptcy filing. He said up until October 2008 the company had been able to pay off its debt; but when the credit crisis hit they ended up unable to make the repayments.
It still remains to be seen how the company will be restructured by the courts. Asset sales and employee reductions are not out of the question.
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