General Growth examines Simon offer -sources

NEW YORK, April 14 Wed Apr 14, 2010 4:42pm EDT

NEW YORK, April 14 (Reuters) - General Growth Properties Inc (GGP.N) is analyzing an offer from rival Simon Property Group Inc (SPG.N) to recapitalize the company, sources familiar with the situation told Reuters on Wednesday.

General Growth is analyzing the Simon offer for how it would affect its operations and whether it would raise any antitrust problems, one source said.

The plan would unseat Brookfield Asset Management (BAMa.TO) as a cornerstone investor in a reorganized company.

But the second-largest U.S. mall owner, which is in bankruptcy, wants to make sure that any deal has a high degree of certainty that it would close, the source said.

General Growth wants Simon to have minimal ability to walk away from a deal, regardless of what the U.S. Federal Trade Commission says on antitrust issues, the source said.

It also wants to analyze what the company's future would be with a competitor like Simon as a large shareholder, as opposed to Brookfield in that position, the source said.

General Growth would have to hear from Simon and Brookfield about their visions of what the future potential under each of their sponsorships would be, the source said.

The sources declined to be named because the discussions are not public. (Reporting by Paritosh Bansal and Ilaina Jonas. Editing by Robert MacMillan) (For more M&A news and our DealZone blog, go to www.reuters.com/deals)

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