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Why Rouse Properties Inc. Stock Jumped Today

By Jordan Wathen - Jan 19, 2016 at 12:41PM

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A very hungry REIT acquirer made a bid for Rouse Properties.

What: Shares of Rouse Properties, (NYSE: RSE) are flying high on Tuesday, up nearly 31% at 1 p.m. EST, after Brookfield Asset Management (BAM -0.08%) made a bid to acquire the real estate investment trust.

So what: Rouse Properties owns 36 malls in 21 states, with roughly 25 million square feet of gross leasable area. Brookfield believes the market is undervaluing its real estate, offering $17 per share to acquire the company, a 26% premium to Friday's closing price of $13.49 per share.

Now what: A special committee is evaluating the proposed buyout. Interestingly, Rouse Properties shares traded at $17.63 at 1 p.m. EST, nearly 4% higher than the proposed transaction price. This could indicate investors' expectations of a second, higher bid by Brookfield before the transaction gets done. 

Jordan Wathen has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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