The Securities and Exchange Commission (SEC) is conducting an insider trading investigation of General Growth Partners (GGP). The bankrupt shopping mall owner also disclosed that it is receiving equity investment from The Blackstone Group.

The SEC is investgating whether former and current company executives broke insider trading laws, and is focusing its investigation on a period of time in late 2008 when the company’s stock prices dropped dramatically. Company executives and board members sold nearly $120 million in stock in September and early October 2008. The company said the investigation will not hinder its operations.

Private equity firm The Blackstone Group will buy a 5% stake in General Growth for $500 million, the company disclosed in bankruptcy court documents Tuesday.

GGP, which has restructured roughly $15 billion in debt since December, amended its restructuring plan earlier this month to reinstate $1.3 billion of Rouse Bonds due 2012 and 2013. It will also change its clawback feature to allow GGP to issue equity at higher prices and retire some lower-priced equity.

The company filed a reorganization plan with the U.S. Bankruptcy Court for the Southern District of New York last month. Under the plan, GGP will split into General Growth Properties, or “new GGP,” and Spinco, with current shareholders receiving common stock in both companies. Spinco will be run by its own separate board of directors and management team.

Brookfield Asset Management, Fairholme Capital Management and Pershing Square Capital Management have committed $8.55 billion in capital. The company still plans to emerge from bankruptcy by October.

General Growth filed for bankruptcy in April 2009 after struggling to manage the massive $27 billion debt burden it had accumulated with large acquisitions and failing to execute several exchange offers.

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