Land & Buildings Issues Letter to Aimco Board Calling for Sale Process
Land & Buildings Investment Management, a major shareholder of Apartments Investment and Management Company (AIV), expresses growing concerns over the company's slow response to address its significant discount to net asset value (NAV). In an open letter to the Board, they call for an urgent, comprehensive strategic review to explore alternatives that could maximize shareholder value, including a potential sale. Land & Buildings highlights the availability of capital in the market and attractive assumable debt, believing that a proactive approach could reveal multiple interested parties and potentially drive the stock price up by 40% to 60%. They urge the Board to act swiftly, noting that the economic environment remains stable but could change rapidly.
- Potential for a significant stock price increase of 40% to 60% through strategic alternatives.
- Attractive assumable debt and continued investor interest in workforce housing.
- Ongoing concerns about the company's failure to act urgently to address its discount to NAV.
- Lack of proactive engagement with potential buyers may limit transaction opportunities.
Believes Company Has Still Not Done Enough to Address Substantial and Persistent Discount to NAV
Urges Board to Immediately Begin a Full Process to Evaluate Alternatives to Maximize Shareholder Value
The full letter is included below:
Dear Members of the Board,
As you know, Land & Buildings remains a large shareholder of Aimco and has continued to engage with the Company since the 2022 Annual Meeting of Shareholders at which our independent nominee, James (“Jim”)
At this point, the path forward is clear to us. Aimco must run a full public strategic review process to evaluate all potential alternatives – including a sale – to deliver value for shareholders. It is our understanding that Morgan Stanley has been retained by the Company and we encourage the Board to make full use of this resource.
In our view, there is at present still capital available in the financing markets for a transaction such as this. Additionally, the Company has attractive assumable debt in place and government-sponsored entities are continuing to lend to support workforce housing, which makes the Company an even more attractive asset.
We are aware of multiple well-financed and interested parties who would likely jump at the chance to engage in transaction discussions with Aimco. While you have encouraged us to send any viable bidders your way, very few of these interested parties will engage in serious discussions without being invited first. And it’s not possible to know the true depth of the buyer pool and the pricing level of a potential transaction without a proactive process. Based on our analysis, we believe a potential sale could result in between
We encourage and expect the Board to act with urgency. The economic environment is still on sound footing and the capital markets remain open for a potential transaction, but either of those variables could change rapidly. We will continue to advocate for the best interests of all shareholders and look forward to a clear update on the status and specifics of the ongoing review of a “broad range of options” to enhance value.
Sincerely,
View source version on businesswire.com: https://www.businesswire.com/news/home/20230418005466/en/
Media
dzacchei@longacresquare.com
Source:
FAQ
What did Land & Buildings express regarding Apartment Investment and Management Company (AIV)?
What potential upside did Land & Buildings estimate for AIV if a sale is pursued?
Who has been retained by AIV to assist with strategic alternatives?
What does Land & Buildings suggest about the current market for a potential transaction for AIV?