December 9, 2009 (FinancialWire) — Simon Property Group, Inc. (NYSE: SPG) said it has entered into a definitive agreement whereby Simon will acquire all of the outlet shopping center business of Prime Outlets acquisition company and certain of its affiliated entities in a transaction valued at approximately $2.325 billion, including the assumption of Prime Outlets’ existing indebtedness and preferred stock.

Under the terms of the agreement, Simon will pay equity consideration of approximately $0.7 billion for the owners’ interests in Prime Outlets. The equity consideration to Prime Outlets’ owners will generally be comprised of 80% in cash and 20% in SPG common operating partnership units, which will be based on a ten day trading average of SPG common stock shortly before closing, subject to a 10% collar.

Prime Outlets is an owner, manager, operator and developer of outlet centers in the U.S. The Prime Outlets portfolio includes 22 outlet centers located in metropolitan markets such as Washington D.C., Baltimore, and San Antonio and tourist destinations such as Orlando, Florida and Williamsburg, Virginia.

Simon plans to fund the cash portion of the equity consideration using its existing sources of capital.

Simon Property Group owns or has an interest in 385 properties comprising 262 million square feet of gross leasable area in North America, Europe and Asia.

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