Tuesday, August 22, 2006

update mills / kanam / xanadu

die operation am offenen herzen bei mills geht weiter. es scheint als wenn colony für mills beim xanaduprojekt einspingen wird. bisher ist dieses allerdings keine bindende vereinabrung sondern lediglich ne art absichtserklärung. bin gespannt wie sich das ganze für kanam auswirken wird. immerhin ist jetzt gewährleistet das das projekt fertiggestellt wird. die kosten sind immer noch deutlich über dem urspünglichen rahmen und die gegebenen renditeversprechen sind nicht zu halten. wie werthaltig die aktien sind ist nich nicht erwiesen. die mls aktie heute plus 10% bei knapp 18,4$


NEW YORK, Aug 22 (Reuters) - Mills Corp. (MLS.N: Quote, Profile, Research) on Tuesday said it agreed to have Colony Capital Acquisitions LLC and its joint-venture partner Kan Am USA Management XXII LP take over the financing of the Xanadu entertainment-shopping complex in New Jersey's Meadowlands in exchange for a significant number of Mills shares.

Mills said the agreement will relieve it of all financial obligations for Meadowlands Xanadu, which is expected to cost $2 billion.

At closing of the deal, expected by Sept. 21, Mills will issue 4.5 million shares or the same number of units in Mills LP, to be allocated between Colony and Kan Am. However, Kan Am would not receive more than 1 percent of the outstanding shares of Mills common stock.



Mills Corp. gets 'Xanadu' funding
REIT's shares rally over pact for New Jersey project

BOSTON (MarketWatch) -- Mills Corp. shares gained as much as 17% Tuesday, rallying as the company said it's in line to secure financing for a shopping-center project in the New Jersey Meadowlands from a pair of firms in exchange for 4.5 million Mills common shares.

The struggling real-estate investment trust MLS19.53, +2.81, +16.8%) said it's signed a non-binding letter of intent to form a partnership as it firms up plans to develop a shopping and entertainment complex to be called Xanadu.

Chevy Chase, Md.-based Mills has been touting Xanadu as an "entertainment destination," located just miles from New York City, that would measure 4.8 million square feet.
The deal would bring Colony Capital Acquisitions LLC into the venture, along with Mills and Kan Am USA Management XXII Limited Partnership. Terms call for Colony to arrange construction financing for Xanadu and make a "significant" equity infusion into the project.

Mills, which is being investigated for accounting problems, would issue either 4.5 million common shares or 4.5 million Mills Limited Partnership units. The shares or units would be allocated between Colony and Kan Am, although Kan Am would not receive more than 1% of the outstanding shares of Mills' common stock.

Under the proposed partnership, Mills would be a limited partner in the project with a total partner capital account of about $485 million, including project funding of $90 million to be funded under an existing term loan. Colony would provide up to $500 million in equity financing and arrange for construction loan financing to cover the remaining balance of what's expected to be $2 billion in total project costs.

Mills said that, upon closing, it will not have any financial obligations to the New Jersey Sports & Exposition Authority, although the recapitalized partnership will. The agency overseas operations at the Meadowlands complex.

The company expects to close the partnership deal on or prior to Sept. 21.
The company also expects to record a charge related to the issuance of units or shares in the deal, and an impairment charge related to its $485 million partner capital account.

Mills Chief Executive Larry Siegel said the transaction will allow the REIT to "achieve its goals of reducing the company's financial obligations and facilitating our exploration of strategic alternatives."

The company has been exploring a sale of all or part of itself. Earlier this month, Mills said it was selling three foreign properties for about $981 million.
Mills' shares were up $2.74, or 16.4%, to $19.46 at last check, after rallying as high as $19.61 in morning action


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