General Growth Properties , the second largest US mall owner, has filed for Chapter 11 bankruptcy protection from its creditors, making it one of the biggest victims of the credit crisis yet.
The Chicago-based owner or operator of more than 200 malls in 44 states, filed for bankruptcy protection in the US Bankruptcy Court in Manhattan, after spending months trying to work out deals with its lenders.
The company said that it plans to continue exploring strategic alternatives during the bankruptcy protection, and will try to use the process to extend its mortgage maturities, and reduce its corporate debt and overall leverage.
Its largest shareholder, hedge fund manager William Ackman's Pershing Square Capital Management, has agreed to provide the company with $375m in debtor-in-possession financing to allow itself to fund operations during the process.
General Growth said it hopes to emerge from bankruptcy protection as quickly as possible.
