Aimco Explores Selling Itself Off To Boost Shareholder Value
Denver-based Apartment Investment and Management Co. is exploring the potential sale of major parts of its business — or even the entire company — as part of efforts to enhance shareholder returns.
The news came in a press release announcing that due diligence had been completed and a $38M deposit was made on a previously announced $520M deal to offload two Miami properties.
Aimco, a leading public company in Colorado sold on the New York Stock Exchange, pointed to a perceived disparity between its stock price and the estimated market value of its assets and services.
“[O]ur shares continue to trade at a meaningful discount to our estimate of the private market value of our assets and investment platform, which we believe has limited our ability to fund new investment opportunities and accelerate growth,” Aimco said in the release.
Aimco’s portfolio includes 5,200 apartment units, about 1,000 recently built apartments, a development in Miami and “a deep pipeline for future growth” consisting of about 7.7M SF, according to the company.
Since late 2020, when it separated its stabilized, income-generating apartment portfolio into a new publicly traded company called Apartment Income REIT Corp., Aimco said it has finalized more than $1.3B in development projects and secured $1.7B through asset sales. Those moves resulted in an average 7.6% growth in annual net operating income.
The company’s stock ended the day slightly down, closing at $8.61.
Aimco’s board of directors is now looking at different ways to grow shareholder value, it said. Selling the company is one of the options it is considering.
“The exploration will expand upon Aimco's ongoing efforts such as reducing exposure to development activity and monetizing certain assets, and include, but not be limited to, exploration of potential sales of the major components of the business (in one or a series of transactions), an acceleration of individual asset sales, or a sale or merger of the Company as a whole,” the company said.
“Our guiding principle will be to produce an outcome that delivers maximum value to Aimco shareholders.”
Aimco’s investment committee is supervising this new process, and Morgan Stanley is acting as Aimco’s financial adviser.
Aimco did not immediately respond to multiple requests for comment.
