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BLOOMFIELD HILLS, MI-A judge has approved a stay for Taubman Centers Inc. of Bloomfield Hills,which requested the action in order to appeal a ruling that it cannot usefriendly shares to vote to block a takeover by Simon Property Group ofIndianapolis.

Now, it appears the local mall REIT will have some more time to avoid thetakeover attempt by Simon. Judge Victoria Roberts of the Eastern District ofMichigan granted the stay Tuesday.Because of the stay, Taubman is free to appeal the recent verdict, and the case willcontinue on for another few months.

Simon says a $20 per share all-cash offer for TCO shares will expire onmidnight, May 30.

The court had recently affirmed its May 1 ruling that the Taubman family andfriends may not vote their 33.6% controlling bloc of shares in TaubmanCenters Inc. unless a majority of disinterested shareholders approve votingrights for those shares.The court held that the formation of a group in November 2002 by the Taubmanfamily and friends to vote the 33.6% controlling bloc of shares was a”control share acquisition” and, therefore, none of the shares comprisingthe 33.6% bloc, including the Series B Preferred Stock held by the Taubmanfamily, can be voted unless and until voting rights for those shares havebeen approved by TCO’s shareholders.

Taubman argued for the stay, saying that it would have to take drasticmeasures, including a possible sale to other bidders, to ensure it kept itsvalue.However, Simon said it will be harmed because it will lose the benefit ofits victory and shareholders will be deprived of their right to decidewhether to accept Simon’s takeover bid for several more months, according toRoberts in her Tuesday ruling.

However, Roberts said Taubman has the right to keep its company intactduring an appeal.”Simon’s argument ignores the fact that the court‚s ruling is preliminary,not final, and is intended only to preserve Simon’s rights until a finaldecision on the merits,” Roberts said. “A stay prohibiting Simon fromproceeding and defendants (Taubman) from impeding the takeover bid appearsto be the best means to preserve all rights.”

The judge admitted that Taubman has raised serious questions regardinginterpretation of the Michigan Control Shares Act that have not been clearlyaddressed at this court level.Taubman has expressed confidence that the ruling will not withstand anappeal to the Sixth Circuit Court.

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