Moody's may cut Rouse, General Growth

Moody's Investors Service said it placed its ratings of General Growth Properties Inc. and its subsidiaries on review for possible downgrade. At the same time, Moody's placed its ratings of The Rouse Co. on review for possible downgrade.

Ratings under review for possible downgrade include Price Development Co. LP's senior debt rated Baa3, GGP Properties LP's senior debt shelf rated prospective Ba1, General Growth Properties Inc.'s preferred stock shelf rated prospective Ba1, and The Rouse Co.'s senior debt rated Baa3, senior debt shelf rated prospective Baa3, and preferred stock shelf rated prospective Ba1.

Moody's said the review was prompted by General Growth's announcement that it has signed a definitive agreement to acquire The Rouse Co. for an estimated purchase value of $12.6 billion, including cash and assumed debt. The transaction will be funded initially with roughly $9.75 billion in bank loans.

General Growth will retain The Rouse Co. as a wholly owned operating subsidiary. The closing of the transaction, expected to occur in the fourth quarter of 2004, is contingent upon approval by the shareholders of The Rouse Co.

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