Ben Johnson

(July 16, 2010) Sam Zell’s Chicago-based international investment firm, Equity International, has sold a significant stake in Brazil’s largest mall developer, BR Malls, to the tune of $245 million.

Here’s the full announcement:

CHICAGO–Equity International (EI), the privately held company focused on investing and building world-class companies outside of the United States, announced today the sale of approximately 18.2 million shares of BR Malls (Bovespa:BRML3), the leading publicly traded retail property company in Brazil, for approximately US$245 million. Following this transaction, EI’s ownership interest in the Company is approximately 6 percent. EI remains a significant and active shareholder in BR Malls.

Headquartered in Rio de Janeiro, BR Malls is the largest retail property company in Brazil and is the most diversified both in terms of geography and coverage of income sectors. The Company is distinguished by its high quality portfolio, significant service business, professional management and efficient operating systems. Since EI’s original investment, BR Malls has grown its portfolio from 7 to 35 shopping malls, representing more than 1 million square meters of gross leasable area with 6,000 stores attracting 430 million visitors annually.

“We continue to have the highest level of enthusiasm for BR Malls and the retail property sector in Brazil, and we remain an avid investor in the Company, the sector and the country,” commented Gary Garrabrant, EI’s chief executive officer. “Today’s sale is simply a reflection of EI’s disciplined and proven monetization philosophy.”

EI made its original investment in BR Malls in 2006 and a follow-on investment three years ago. “The Brazilian retail sector continues to offer significant growth opportunities and we look forward to working with BR Malls to capitalize on these,” added Mr. Garrabrant.

EI provides ongoing strategic direction and counsel to BR Malls, and Thomas McDonald, EI’s chief strategic officer, continues to serve as a member of the Company’s Board of Directors.

(June 10, 2010) Chicago billionaire investor Sam Zell is getting hungry for another acquisition candidate.

Shares in publicly traded Rewards Network Inc. (NASDAQ:DINE) jumped 38% on June 9 after receiving an overture from investor Sam Zell to take over the firm.

Rewards Network stock closed at $13.67 and recorded the biggest gain in the Russell 2000 Index. Zell’s Equity Group Investments LLC, which owns 26.4% of the Chicago-based operator of discount dining programs, said in a filing it is prepared to offer $13.50 a share for the company.

Rewards Network issued a plain vanilla response to the offer:

CHICAGO, IL, Jun 09, 2010 (MARKETWIRE via COMTEX) –Rewards Network Inc. (NASDAQ: DINE) announced that it has received non-binding indications of interest from parties potentially interested in pursuing a strategic transaction with the Company. A special committee of independent directors of the Board of Directors of the Company is evaluating these indications of interest and other strategic alternatives. The Company has engaged Harris Williams & Co. to assist in evaluating the indications of interest received to date and to pursue a broader exploration of strategic alternatives in an effort to enhance shareholder value.

(May 21, 2010) Sam Zell is going bonkers over Brazil, again.

According to Equity International CEO Gary Garrabrant, the firm hopes to raise $500 million to plow into Brazilian real estate and companies that develop residential and commercial properties there. Zell is chairman of Equity International.

“Our enthusiasm for Brazil could not be higher,” said Garrabrant in a recent interview with Bloomberg News in Sao Paulo. “You’ve got this local demand that’s unparalleled.”

Earlier this year, Zell sold part of his stake in Brazilian homebuilder Gafisa SA, raising some fears that his fervor for the country had cooled. Such is obviously not the case.

To read the entire Bloomberg story, click here.

(April 14, 2010) Sheli Rosenberg, a long-time associate of Sam Zell, has been named to the board of directors of embattled mall owner General Growth Properties in Chicago. Here is the formal GGP announcement:

General Growth Properties Appoints Sheli Rosenberg To Board of Directors

General Growth Properties, Inc. (NYSE: GGP) today announced Sheli Z. Rosenberg has joined GGP’s Board of Directors. She will serve on GGP’s Capital Committee.

Ms. Rosenberg is the former president, chief executive officer and vice chairwoman of Equity Group Investments, L.L.C., a privately held real estate investment firm and has been an adjunct professor at Northwestern University’s J.L. Kellogg Graduate School of Business since 2003. Ms. Rosenberg currently serves as a director of CVS Caremark Corporation, the nation’s largest pharmacy chain, Nanosphere, Inc., a nanotechnology-based healthcare company, Equity LifeStyle Properties, Inc., an owner and operator of high-quality resort communities, and Ventas, Inc., one of the nation’s leading healthcare real estate investment trusts. Ms Rosenberg is also a trustee at Equity Residential, the largest publicly traded owner, operator and developer of multi-family housing in the United States.

“We are very pleased to announce Sheli’s appointment to GGP’s Board of Directors,” said Adam Metz, chief executive officer of GGP. “Sheli’s vast real estate experience and broad business knowledge make her a great asset to GGP. As we continue to position the Company for a successful future, we look forward to Sheli’s insights and expertise.”

Ms. Rosenberg joined Equity Group Investments, Inc. in 1980 as general counsel, rising to become its chief executive officer, president and vice chairwoman when she departed the company in 2003. Over the course of her career, Ms. Rosenberg has been instrumental in the structuring and management of six investment funds with assets totaling more than $2 billion, acquisitions and dispositions of more than $10 billion in assets and the initial public offerings of seven New York Stock Exchange companies.

Prior to joining EGI, she was a managing partner of Schiff Hardin & Waite, specializing in real estate, finance and corporate law. She is a co-founder and president of the initiative for the new Center for Executive Women at the J.L. Kellogg Graduate School of Business. Ms. Rosenberg graduated from Tufts University and Northwestern University School of Law.

The appointment of Ms. Rosenberg, an independent director, brings the number of directors of GGP to 10. 

(April 13, 2010) Tribune Company has finally filed a formal plan to exit its 16-month long bankruptcy. Essentially the plan gives creditors control of 91% of the company, which some estimate will be worth around $6 billion. Here is the company’s statement:

Company Charts Path to Emerge From Chapter 11 with Sufficient Liquidity and the Ability to Expand Its Business

Tribune Company today filed with the United States Bankruptcy Court for the District of Delaware, a Plan of Reorganization (“Plan”) that would keep the company intact, sharply reduce its debt, and provide it with sufficient liquidity to expand its business in the future.

Tribune filed a voluntary petition under Chapter 11 of the U.S. Bankruptcy Code in December 2008, and has continued operating its newspapers, broadcasting assets and interactive properties without interruption since that time. The Plan, which must still be approved by Tribune creditors and the Court, is expected to enable the company to emerge from bankruptcy later this year.

“Tribune’s leadership team and employees have done an outstanding job of stabilizing and refocusing the company’s business,” said Sam Zell, chairman. “Today’s filing represents a significant and positive step forward for the business.”

Tribune’s chief executive officer, Randy Michaels, said, “We continue to transform Tribune into an industry-leading media company, improving our competitive position. This Plan better positions us to continue serving our users, readers, viewers, listeners and advertisers across our media platforms and gives us an opportunity to expand our business upon emergence from a solid financial base.”

Tribune expects to continue its recently implemented employee retirement plan, featuring a 401(k) with a company match and a discretionary profit-sharing allocation. Under the Plan, the company’s employee stock ownership plan would terminate and the shares held by the ESOP and in employee accounts would be extinguished.

“We’re looking forward to emerging from Chapter 11 and building on the momentum we’ve generated,” said Michaels.

(April 8, 2010) Bankrupt Tribune Co. has settled its debts with a few creditors as it continues to inch forward to emerge from Chapter 11.

Tribune issued this statement today:

 Tribune Company today announced an agreement supported by major creditors J.P. Morgan and Angelo Gordon, lenders under the company’s prepetition senior credit facility, and Centerbridge Partners, holder of approximately 37 percent of the company’s outstanding prepetition senior notes, proposing to settle all potential claims arising from the company’s going-private transactions in 2007. 

The terms of the agreement, which also has the support of the Official Committee of Unsecured Creditors, will be incorporated into a plan of reorganization for Tribune and its debtor affiliates, to be filed with the U.S. Bankruptcy Court for the District of Delaware.  “The company supports the resolution of our bankruptcy through a plan of reorganization that implements the terms of this agreement.  The plan will allow us to resolve these cases without the distraction, expense and delay of protracted litigation, and is in the best interests of Tribune and all of our constituents,” said Don Liebentritt, Tribune’s Chief Legal Officer.  

“We’re very pleased that an agreement has been reached, and we appreciate the support we’ve received from J.P. Morgan, Angelo Gordon, Centerbridge and the Committee,” said Randy Michaels, Tribune’s Chief Executive Officer.  “This will enable us to file our plan prior to next Tuesday’s court hearing.  It is another significant step forward as we continue to transform our media businesses, attract and retain talented people, and seize opportunities to grow.”

Under the plan, the holders of the senior notes would receive 7.4 percent of the company’s distributable value, which would be paid in a combination of cash, debt and stock.  The company’s senior credit facility lenders would receive cash and debt, and stock representing in excess of 91 percent of the equity of the reorganized company.  Under the plan, the company would emerge from bankruptcy, significantly deleveraged, with its business units intact and with adequate liquidity for operating and capital needs.  Once filed, the plan will be subject to a creditor vote and approval by the Court.

Material terms of the agreement have been filed with the Bankruptcy Court. 

Tribune and most of its subsidiaries filed voluntary petitions under Chapter 11 of the U.S. Bankruptcy Code in December 2008, and have continued operating their newspapers, broadcasting assets and interactive properties without interruption since that time.  The plan is expected to enable the company to emerge from bankruptcy later this year.

(April 1, 2010) Tribune Company bought itself until at least April 13 to file a final reorganization plan to emerge from its 15-month-long Chapter 11 bankruptcy filed way back in December 2008.

On March 31, Tribune formally filed a motion in U.S. bankruptcy court in Delaware to extend the deadline for a filing until April 30. Now Judge Kevin Carey is expected to rule on the motion at the next hearing scheduled for April 13.

The move gives Tribune time to finalize negotiations with some contentious junior creditors.

On March 4, a group of bondholders filed a lawsuit against Tribune and its senior creditors, claiming the $8.3 billion leveraged buyout in 2007, orchestrated by Chicago billionaire investor Sam Zell, doomed the company to bankruptcy.

Judge Carey has not yet ruled on an earlier request by the bondholders and the Office of the U.S. Trustee to hire an examiner to investigate the buyout.

(March 23, 2010) Sheli Z. Rosenberg, one of Chicago investor Sam Zell’s closest confidantes for the past 17 years, is retiring from the board of apartment owner Equity Residential effective in June. Rosenberg, who is 68, has been on the board of the Chicago-based company since it was launched in 1993.

Rosenberg was vice-chairman and president and CEO of Equity Group Investments, companies which were founded and are chaired by Zell.

She sits on several boards, including CVS, Ventas, Nanosphere and Equity Lifestyle Properties, another Zell company.

Rosenberg’s resume reflects her pioneering nature. She was one of only seven women in her graduating class at Northwestern University School of Law in Chicago in 1966 and was the first woman partner at Schiff Hardin LLP. She is co-founder and former president of the Center for Executive Women at Northwestern University’s Kellogg Graduate School of Management and has been an adjunct professor at the school since 2003.

(March 10, 2010) Chicago investor Sam Zell’s ranking among global billionaires fell last year. Produced by Forbes magazine, the much-watched annual list of the richest of the rich dropped Zell’s placing from No. 205 in 2008 to No. 237 in 2009.

Despite the fall, Zell’s net worth actually increased by 21%, up from $3 billion in 2008 to $3.8 billion in 2009.

For a change, Bill Gates did not top the list this year. He was replaced by Mexican telecom billionaire Carlos Slim, lately a major investor in the New York Times. Gates now ranks a lowly second while the “oracle from Omaha” Warren Buffett ranks third. Oh well, better luck next year.

See the complete ranking here.

(March 5, 2010) A group of creditors is suing the lead banks involved in taking Tribune Company private in 2007. The banks include some of the world’s largest financial institutions, led by JPMorgan Chase Bank, Bank of America, Citibank, Merrill Lynch Capital Corp., and Morgan Stanley & Co.

The suit was filed by Wilmington Trust, which represents bondholders of $1.2 billion in Tribune debt. They claim the banks knowingly doomed Tribune to bankruptcy by loaning the company, led by CEO Sam Zell, $8 billion to fund the leveraged buyout.

See the full story on Bloomberg.