Farmland Partners Inc. Announces Agreement for Acquisition of 15,042 Acres of Farmland for Cash and Equity Consideration
DENVER, March 25, 2015 /PRNewswire/ -- Farmland Partners Inc. (NYSEMKT:FPI) (the "Company") today announced that it has entered into a purchase agreement to acquire eight row crop farms in North Carolina, South Carolina, and Virginia comprising an aggregate of 15,042 acres. The farms were purchased for total consideration of $49.8 million in cash and an aggregate of 2,981,971 shares of common stock and units of limited partnership interest in the Company's operating partnership. The acquisitions are expected to close in May 2015, subject to customary closing conditions.
The Company entered into a five-year lease agreement with the seller for all eight farms with an initial annual cash rent of approximately $4.3 million, including for the 2015 crop year. The Company expects this transaction to be accretive to Adjusted Funds from Operations and, as a result, the Company's management expects to recommend to the Board of Directors that, after closing of the acquisition, the Company's quarterly dividend be increased by approximately 10%, to an annual rate of $0.51 per share.
"This agreement marks our largest acquisition to date," said Paul Pittman, CEO of the Company. "It is our second sizable transaction in the Southeast, following our acquisition of approximately 6,800 acres in South Carolina in December, and will expand our geographic footprint to include two new states – North Carolina and Virginia."
About Farmland Partners Inc.
Farmland Partners Inc. is an internally managed real estate company that owns and seeks to acquire high-quality primary row crop farmland located in agricultural markets throughout North America. The Company's portfolio is comprised of 93 farms with an aggregate of 49,346 acres in Illinois, Nebraska, Colorado, Arkansas, Louisiana, Mississippi, and South Carolina, with 12 farms under contract in Nebraska, Colorado, Arkansas, North Carolina, South Carolina, and Virginia, totaling 18,574 acres. The Company intends to elect and qualify to be taxed as a real estate investment trust, or REIT, for U.S. federal income tax purposes, commencing with the taxable year ended December 31, 2014.
Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws, including statements regarding the pending acquisitions, leases and a potential dividend increase. Any future dividends will be authorized by the Company's Board of Directors in its sole discretion out of funds legally available therefor and will be dependent upon a number of factors, including restrictions under applicable law, the capital requirements of the Company and the distribution requirements necessary to qualify and maintain the Company's qualification as a REIT. Any determination to increase the Company's dividend will depend upon the Company's actual results of operations and earnings, economic conditions and other factors that could differ materially from the Company's current expectations. Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond the Company's control. The Company faces many risks that could cause its actual performance to differ materially from the results contemplated by its forward-looking statements, including, without limitation, the risks related to leasing farmland to third-party tenants, including delays in executing new leases and failure to negotiate leases on terms that will enable the Company to achieve its expected returns. These forward-looking statements are based upon the Company's present expectations, but the events, expectations, intentions or prospects suggested by or reflected in these statements are not guaranteed to occur or be achieved, and you should not place undue reliance on such statements. Furthermore, the Company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes, except as may be required by law. For a further discussion of these and other factors that could impact the Company's future results, performance or transactions, see the section entitled "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2014 and other documents filed by the Company with the Securities and Exchange Commission.
SOURCE Farmland Partners Inc.
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