General Growth Properties (NYSE: GGP)

I just read this article by Bill Ackman of Pershing Square Capital on why General Growth Properties' (NYSE: GGP) common stock is a buy.

The thesis is rather intriguing. Ackman alleges that GGP was forced into bankruptcy due to a liquidity crisis (ie unable to re-finance its debt). It was heavily dependent on the CMBS market for its debt issues. When that market froze this year, it was unable to re-finance its currently due debt. This lead to its debtors forcing it to declare bankruptcy even though it was not insolvent (ie liabilities more than assets). This mean that even in a liquidation scenario, the common stockholders obtain a payback larger than its share price, which was very low (around $1). He makes a rather convincing case of this scenario.

Here's Ackman's original presentation:
http://zerohedge.blogspot.com/2009/05/ackman-on-general-growth.html

I'd like to thank Zero Hedge for highlighting this intriguing opportunity.