NEW YORK — Taubman Centers Inc.’s efforts to rebuff Simon Property Group Inc.’s ongoing hostile takeover bid received a big assist from the Michigan State Senate Thursday.
The senate passed, by a 24 to 14 margin, legislation that will allow the Taubman family to vote their controlling shares against the takeover, overturning a state court ruling that effectively prevented them from doing so.
The earlier court ruling said the Taubman family, which controls approximately two-thirds of the company, needed the approval of non-family shareholders to vote their interest. While the Taubman family opposes the takeover, most of the shares owned by non-family stockholders have been voted in favor of the deal.
The bill will now be sent to Michigan Gov. Jennifer Granholm, who is expected to sign it.
The dispute began when the Taubman family engaged other shareholders to vote as a bloc against the takeover. Michigan law stipulates that under certain conditions, such groups must receive approval from outside shareholders. The bill effectively nullifies that stipulation.
In a statement, Taubman applauded the legislature “for doing the right thing by clarifying the intent of the Michigan Control Share Acquisitions Act to continue to protect Michigan companies from corporate raiders.”
The setback for Simon was its second in a week. Last Thursday, as reported, a federal district court ordered the firm to sell its 27.5 percent stake in Minnesota’s Mall of America to Triple Five for $81.4 million. Simon said it would appeal the ruling.