General Growth has deals to restructure $11.6 billion of debt

General Growth Properties Inc., the second-largest U.S. mall owner, has won approval from creditors and a federal court to restructure loans totaling $11.6 billion, according to a lawyer.

The company today won confirmation from U.S. Bankruptcy Judge Allan Gropper in Manhattan of its plan to extend the maturities of seven loans at least $1.3 billion after creditors agreed to the terms.

That amount was in addition to $10.25 billion in debt that Gropper said on Dec. 15 Chicago-based General Growth could reorganize in its Chapter 11 bankruptcy case, bringing the total to $11.6 billion, said Anup Sathy, a lawyer from Kirkland & Ellis LLP representing General Growth.

"Certainly in my view the system has worked," Gropper said during the hearing. He said the interests of lenders and the various General Growth units were protected.

Today's ruling leaves five loans covering 24 properties, including malls in Las Vegas and Louisiana, which the company wants lenders to agree to alter, Sathy said.

Gropper has scheduled another hearing for Dec. 29. General Growth is continuing to negotiate with lenders and loan servicers to add more properties into the restructuring plan, Sathy said.

General Growth filed the biggest real-estate bankruptcy in U.S. history in April after amassing $27 billion in debt during an acquisition spree. At the time of the bankruptcy, the company said it had around $11.8 billion in debt that had matured or was due by the end of 2012. The company owns or manages more than 200 shopping malls in 44 states and also owns office buildings.

Shares of General Growth rose $1.50 to $10.95 in over-the- counter trading. Earlier today William Ackman's Pershing Square Capital Management LP said in a presentation that the company was undervalued.

The case is In re General Growth Properties Inc., 09-11977, U.S. Bankruptcy Court, Southern District of New York (Manhattan).