Shopping center operator Simon Property Group launches SPAC for retail
Special Purpose Acquisition Companies (SPACs) are the flavor of the month with investors and those looking to go public, and now Simon Real Estate Group (NYSE: SPG) launches into action.
The mall operator has filed with the Securities and Exchange Commission (SEC) an opinion that he is creating Simon Property Group Acquisition Holdings, a PSPC that will target “an industry that will benefit from experience, expertise and skills. operational skills of our management team “.
On the way to a new tangent
Simon Property Group continues to grapple with the retail apocalypse that has bankrupted large chains and forced them to close stores. To prevent his shopping centers from going unoccupied, Simon started buy out retailers from bankruptcy, often in partnership with another operator of the shopping center Brookfield Asset Management (NYSE: BAM) and the brand management company Authentic Brands Group.
Acquisitions include JC Penney, Forever 21 and Aeropostale.
PSPC takes the mall operator in a whole new direction. The brief says he believes “this new pillar will support the delivery (of Simon Property Group) of innovative solutions to elevate and reinvent shopping and transform retail.”
Given the state of the industry, a retail PSPC would seem risky, but data analytics firm Placer.ai has become an industry bull for malls after analyzing malls traffic data. The industry has been overwhelmed by the COVID-19 pandemic but has steadily improved throughout the past year.
According to Placer.ai, the combination of the strength from the start of last year, a strong recovery from Black Friday and the industry’s ability to rebound, even though traffic ended up down 32%, “reinforce all the idea that 2021 could be much more favorable to indoor malls than many expect. “
A new business at the “intersection of retail and tech” could capitalize on this trend. PSPC plans to raise $ 300 million by selling 30 million units at $ 10 each.
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