The Howard Hughes Corporation ("Howard Hughes" or the "Company") (NYSE: HHC) today announced that is has retired 6,083,333 Sponsor warrants for $80,548,000 in cash and the issuance of 1,525,272 shares of common stock.
On December 7, 2012, affiliates of Blackstone Real Estate Partners sold their 333,333 warrants and the Fairholme Funds sold their 1,916,667 warrants to The Howard Hughes Corporation for $30.00 cash per warrant. On November 9, 2012, affiliates of Brookfield Asset Management exercised a portion of their warrants and sold to the Company the remainder of their warrants in exchange for 1,525,272 shares of the Company's stock and a net $13,048,000 cash payment. All of the extinguished warrants had a $50.00 per warrant exercise price and a November 2017 expiration date. Together, the warrant transactions reduced diluted shares outstanding by 9.2%, or 4,558,061 shares, as reflected in the table below:
|September 30, 2012||Transactions||Pro Forma|
|Employee stock options||841,440||841,440|
“I expect that the retirement of these warrants will be significantly accretive because our shareholders will now own 10.1% more of the Company,” said David R. Weinreb, Chief Executive Officer of The Howard Hughes Corporation. "Since becoming a public company, Howard Hughes has made substantial progress in advancing the development and redevelopment of our assets. We have built a premier real estate investment and development company and are confident that we will unlock substantial additional value over the next several years as we develop our properties."