Updated from 12:50 p.m. EDT
Farallon Capital, one of the world's largest hedge funds, has taken a 5.6% stake in troubled mall owner
The San Francisco-based hedge fund disclosed in an
Securities and Exchange Commission
filing Thursday that it owns 3.18 million shares of Mills, which is currently restating its financials and exploring a
sale of the company.
Farallon was named the world's largest hedge fund in 2004 by
magazine, which said the firm had $12.5 billion of capital at the end of that year.
It's not clear what strategy the fund has in mind for Mills. Farallon didn't immediately return a call seeking comment.
Farallon pursues a number of strategies, including credit investments, restructurings, value investing, and direct debt and equity investments in companies and real estate properties.
The firm is known for its real estate acumen, with a number of its managing members having previously worked at JMB Institutional Realty, a longtime commercial real estate investor that was a particularly active buyer in the late 1980s and early 1990s.
Interestingly, Farallon has already done some business with Mills. In February, when Mills scrapped its retail development project on the San Francisco waterfront, the company sold the development rights to Farallon and Shorenstein Development for $9 million, according to the
San Francisco Chronicle
The newspaper reported that the city's port commission approved the rights transfer in March and said the firms plan to build office properties with a recreation component.
Mills' shares were up nearly 12% in afternoon trading Friday after luxury mall owner
said in its earnings conference call that it was interested in buying several of Mills' development projects and existing assets, including the 50% stake it doesn't already own in its joint venture with the company at Arizona Mills.
However, CEO Robert Taubman said his company was not interested in buying Mills as a whole.
Mills shares recently changed hands at $33.06, up $3.46.