Bloomfield Hills-based mall giant Taubman Centers Inc. is being sold for $3.6 billion to a rival shopping mall company, the companies announced Monday.

Indianapolis-based Simon Property Group LP (NYSE: SPG) is paying $52.50 per share cash for all of Taubman's (NYSE: TCO) common stock and the Taubman family is selling one-third of its ownership interest and remain a 20 percent partner, according to a news release.

Robert Taubman, chairman, president and CEO of Taubman Centers, is expected to continue leading the existing executive team, managing about 25 million square feet of shopping center space in the U.S. and Asia, the companies said.

The new Taubman board is expected to have three designees of Simon Property Group and three of Taubman.

The deal is expected to close in the middle of the year and needs two-thirds approval of the outstanding voting stock of Taubman and a majority of the outstanding voting stock of Taubman not held by the Taubman family, according to an investor presentation.

Taubman owns, manages and/or leases 26 super-regional shopping centers in the U.S. and Asia, consisting of about 25 million square feet of gross leasable area, including Twelve Oaks Mall in Novi and Great Lakes Crossing Outlets in Auburn Hills.

It sold Fairlane Town Center in Dearborn and The Mall at Partridge Creek in Clinton Township plus five other malls for $1.4 billion to Starwood Capital Group in 2014.

The deal is a 51 percent premium to where Taubman shares closed on Friday at $34.67 per share. Shares soared 52 percent early Monday after it resumed trading following a stop for the announcement. Simon shares were up less than 1 percent trading Monday morning; they are down 24 percent over the past 12 months.

Matthew Mason, managing director of Conway MacKenzie Inc.'s Real Estate Advisory Practice in Birmingham, said he has worked with Simon Property Group and Taubman in the past. He said the deal makes sense for both companies given the consolidation in the mall industry in recent years, like when Brookfield Property Partners paid $9.25 billion for General Growth Properties two years ago.

"I think it's a logical move for both parties," Mason said. "Brookfield, it's become a very large operator now, and Simon obviously is very large as well. It's become more difficult for operators below them. Taubman doesn't have the scale of Brookfield now, or Simon, and it gets more difficult to compete."

David Simon, chairman, CEO and president of Simon Property Group, said in a conference call Monday morning that the joint venture would be "very much run like a partnership" with Taubman.

"By joining together, we will enhance the ability of (Taubman) to invest in innovative retail environments that create exciting shopping and entertainment experiences for consumers, immersive opportunities for retailers and substantial job prospects for local communities," Simon said in the release.

Activist investor Jonathan Litt has been peppering Taubman the past few years with various criticisms, including lack of diversity on the board, financial underperformance in the past several years as the company navigates an ever-shifting and challenging mall and retail climate, and flawed capital expenditures in Asian markets and in Puerto Rico.

Litt praised the deal in a tweet Monday morning: