Simon Property aims to extend debt at low rates with notes refinancing

By Lisa Kerner

Charlotte, N.C., Jan. 13 - Simon Property Group, Inc. said its planned refinancing is intended to take advantage of the current unusually attractive borrowing costs to extend its debt maturities.

The company expects to finance the tender offer announced on Tuesday through a combination of new, long-term senior notes at benchmark size and cash on its balance sheet.

Using the notes and cash will enhance Simon Property's "balance sheet flexibility and reduce refinancing risk," a company spokesperson said.

It will also allow Simon to "capitalize on an historically low interest rate environment to extend duration profile" and "invest existing cash position at attractive relative yields."

On Tuesday Simon said its operating partnership subsidiary, Simon Property Group, LP, began a tender offer for 10 series of notes.

The operating partnership is offering to buy notes due between Jan. 20, 2011 and March 13, 2013 at a purchase price between $1,052.50 and $1,092.50 per note.

The tender offer will expire at 5 p.m. ET on Jan. 20.

The dealer managers for the tender offer are Citigroup Global Markets Inc., Morgan Stanley & Co. Inc. and RBS Securities Inc.

Further details on the new notes have not been announced.

Simon is a real estate company based in Indianapolis.

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