Shareholders of Taubman Centers have overwhelmingly voted to approve and adopt the company's merger agreement with fellow shopping mall real estate investment trust Simon Property Group Inc, despite the latter's legal maneuverings to halt the proposed $3.6 billion deal.

Taubman announced that at a special meeting of shareholders on Thursday about 99.7% of the shares voted were in favor of the merger agreement, meaning that about 84.7% of the outstanding Taubman shares entitled to vote gave sign off on the deal. That number represents about 78.3% of the outstanding voting shares held by shareholders who are not members of the Taubman family, according to the company.

"Taubman stands ready, willing and able to close the Transactions with Simon on June 30, 2020, the third business day following the satisfaction of all conditions precedent, which is the timeline required by the Merger Agreement," the REIT said as it announced the voting results.

The company, however, noted that the deal is unlikely to close as originally planned, since Simon has moved to terminate the deal and filed a lawsuit in the Circuit Court for the 6th Judicial Circuit of Oakland County, Michigan against Taubman seeking a declaration that Taubman has suffered a material adverse event while the deal, which was originally announced in February, has been pending.

Simon contends that Taubman was disproportionately hit by the COVID-19 outbreak, which has been declared a global pandemic since the deal was announced.

"Given Simon's purported termination of the Merger Agreement and the pending litigation, it appears that Simon will not consummate the Transactions on June 30, 2020, despite Simon's contractual obligation to do so," Taubman said.

Taubman has filed an answer and counterclaim in Simon's lawsuit denying the underlying allegations and seeking to force Simon to fulfill its obligations under the merger agreement, including to consummate the deal.

Instant Insights /

With Simon Going to Court to Put the Brakes on Merger, Taubman Moves Forward with Shareholder Vote

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