Rouse Properties Inc (RSE) Buyout Offer From Brookfield Asset Management (BAM) Sends Stock Soaring

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Shares of Rouse Properties Inc (NYSE:RSE) are up huge this morning, after it was announced that Brookfield Asset Management Inc. (NYSE:BAM) made an offer to acquire all outstanding shares of Rouse Properties stock for $17.00 per share. While this is a non-binding proposal, Rouse has formed a special committee to look into possibly reaching a deal with Brookfield.

To help with legal consel, Rouse Properties Inc (NYSE:RSE) has hired Sidley Austin LLP and BofA Merrill Lynch to advise and assist the Special Committee. At the same time, the company will also take into consideration other potential moves, other than a possible acquisition, in order to maximize shareholder value. This offer could even open the door to future offers now than the Brookfied offer is on the table.

It should be interesting to follow trading of Rouse stock today and the rest of the week as we learn more on other potential moves that the company may decide to make. The stock is up 32.47% or $4.38 following the news, hitting $17.87 per share. About 618,951 shares traded hands or up 106.40% from the average. RSE has declined 17.29% since June 12, 2015 and is currently downtrending. It has underperformed the S&P500 by 8.42%.

From a total of 3 analysts covering Rouse Properties Inc (NYSE:RSE) stock, 2 rate it a “Buy”, 1 a “Sell”, and 0 a “Hold”. This means that 67% of the ratings are positive. The highest target price is $21 while the lowest target price is $21. The mean of all analyst targets is $21 which is 17.52% above today’s ($17.87) stock price. Rouse Properties Inc was the topic of 7 analyst reports since July 22, 2015 according to the firm StockzIntelligence Inc. Bank of America downgraded shares on January 12 to a “Underperform” rating. Canaccord Genuity maintained RSE stock in a recent report from August 24 with a “Buy” rating.

The institutional sentiment increased to 1.43 in Q2 2015. It’s up 0.52, from 0.91 in 2015Q2. The ratio is positive, as 12 funds sold all their Rouse Properties Inc shares they owned while 32 reduced their positions. 10 funds bought stakes while 53 increased their total positions. Institutions now own 56.85 million shares which is 8.04% less than the previous share count of 61.83 million in 2015Q2.

Bruni J V & Co Co holds 4.61% of its total portfolio in Rouse Properties Inc, equating to 1.46 million shares. Brookfield Asset Management Inc. owns 19.39 million shares representing 1.87% of their total US portfolio. Moreover, Corsair Capital Management L.P. has 1.5% of their total portfolio invested in the company, equating to 921,973 shares. The Ontario – Canada-based Ci Investments Inc. has a total of 0.86% of their portfolio invested in the stock. Horizon Kinetics Llc, a New York-based fund reported 2.66 million shares owned.

Rouse Properties, Inc. is a real estate investment trust . The company has a market cap of $1.04 billion. The Company’s principal focus is to own and manage regional malls in protected markets or submarkets in the United States. It has 34.85 P/E ratio. As of December 31, 2014, the Company’s portfolio consisted of 36 regional malls in 23 states totaling over 25.5 million square feet of retail space.

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