Stock Alert: Taubman Centers Falls 38% On Merger Deal Termination

(RTTNews) - Shares of Taubman Centers Inc. (TCO) are tumbling more than 38 percent or $17.22 in Wednesday's morning trade at $28.03 following news of termination of the real estate investment trust's merger deal with mall owner Simon Property Group Inc. (SPG). The stock has traded in a range of $26.70 to $53.40 in the past 52 weeks.

Wednesday, Simon Property said it has exercised its contractual rights to terminate its February 9, 2020 merger agreement with Taubman Centers.

Simon Property added that it filed a lawsuit against Taubman for allegedly breaching covenants of the merger deal.

According to Simon Property, the COVID-19 pandemic had a uniquely material and disproportionate effect on Taubman compared with other participants in the retail real estate industry.

Second, Taubman breached its obligations by failing to take steps to mitigate the impact of the pandemic compared to others in the industry, including by not making essential cuts in operating expenses and capital expenditures, Simon Property added.