New York-based REIT American Farmland (NYSE MKT: AFCO) said it has retained Citigroup and Raymond James as its financial advisors and Goodwin Procter LLP as legal counsel to assist in a comprehensive analysis of all potential strategic alternatives, including a merger or sale of all or part of the company or its assets, or a joint venture.
AFCO was founded in 2009 by an illustrious team of New York tycoons, Palm Beach A-Listers and global investment professionals across the agriculture, real estate, and alternative investment industries: D. Dixon Boardman (chairman) of Optima Fund Management, Harrison T. LeFrak (vice chairman), Alfonso and J. Pepe Fanjul of Florida Crystals Corporation, and William von Mueffling of Cantillon Asset Management. Thomas S.T. Gimbel is the company’s CEO.
D. Dixon Boardman is the founder and CEO of Optima Fund Management, with over $4 billion in assets under management. He was one of the early fund-of-funds innovators in the US, having launched Optima’s flagship fund in July 1988. He has built the firm into one of the industry’s most well-respected businesses including funds of funds, single-manager hedge funds and institutional multi-manager programs. Because of his expertise in the hedge fund industry, he is often quoted in the Financial Times and The Wall Street Journal, as well as in other financial publications. He appears frequently on CNBC to give his overview on the hedge fund industry. In addition, he has served as chairman of the Special Projects Committee of Memorial Sloan Kettering Cancer Center and is currently a member of the President’s Council of Memorial Sloan Kettering Cancer Center. He is a director of Florida Crystals Corporation and an advisory board director of J.C. Bamford Excavators (U.K.). Prior to forming Optima, he advised high net worth individuals, first at Kidder, Peabody, where he was one of the 20 leading stockbrokers in the firm, and then at UBS PaineWebber, where he was a member of the chairman’s Council. He attended McGill University. In 2001 he married Princess Arriana zu Hohenlohe-Langenburg, the daughter of Princess Jackie Lane-Hohenlohe of Los Angeles, and Prince Alfonso zu Hohenlohe-Langenburg of Marbella, Spain.
Harrison T. LeFrak, vice-chairman and managing director of the LeFrak Organization since 1997, is the son of billionaire Richard LeFrak, the group’s chairman and CEO. Harrison LeFrak is also president and CEO of the LeFrak Trust Company, a private financial institution in Delaware, and serves as an adviser to the LeFrak Foundation, a private charitable organization, also based in Delaware. He received a JD from Harvard Law School, an MBA from Columbia Business School, and a B.A. from the Woodrow Wilson School of Public and International Affairs at Princeton University.
The Cuban-born Fanjul brothers are owners of Fanjul Corp., a vast sugar and real estate conglomerate in the United States and the Dominican Republic. It comprises the subsidiaries Domino Sugar, Florida Crystals, C&H Sugar, Redpath Sugar, Tate & Lyle European Sugar, La Romana International Airport, and resorts surrounding La Romana, in the Dominican Republic.
William von Mueffling is the founder, president and CEO of Cantillon Capital Management, an investment firm with more than $12 billion under management. He was previously a managing director at Lazard Asset Management, where he was responsible for hedge funds, and was considered “a rock star.” He reportedly averaged annual returns of over 30% from 1998 to 2003, made largely by shorting technology stocks. Prior to joining Lazard, he was with Deutsche Bank in Germany and France. He earned an MBA from Columbia Business School and a BA from Columbia College.
Thomas S.T. Gimbel is a partner, executive managing director, and chief portfolio risk officer at Optima Fund Management. He joined Optima in 2004 from Credit Suisse Asset Management where he was managing director for Hedge Fund Investments. He was previously head of the Hedge Fund Department at DLJ. Prior to DLJ, he was managing director in Investment Banking at PaineWebber and chairman of PaineWebber Futures Management Corporation. He assembled that firm’s first fund-of-funds in 1994 with Optima as a sub-adviser. His career began in investment banking in 1978. He has a B.A. in economics from Bowdoin College and an MBA in finance from Columbia Business School. He is a member of the board of overseers of Children’s Hospital in Boston, director of Lighthouse International and a director of Prime Energy Corporation.
American Farmland Company
In 2010, the company began deploying capital by acquiring four high-quality farmland properties across the United States: two Illinois row crop farms, a California Merlot wine grape vineyard and a mixed vegetable farm in Florida.
In 2011, AFCO continued to diversify its portfolio with a citrus development, an Arkansas row crop farm, additional Midwestern row crops, a lemon and avocado development and a strawberry and lettuce property in California.
In 2012, the company acquired an almond orchard, a second parcel to its strawberry farm, a Chardonnay/Pinot Noir vineyard and a citrus development in Florida. Additionally, the Company formally elected status as a Real Estate Investment Trust, and subsequently paid its first dividend to shareholders in December.
In 2013, AFCO acquired three new development properties to be converted into a mixed vegetable farm in Florida and a pistachio orchard and vineyard in California. A fully mature walnut orchard was also added to the Company’s growing portfolio.
In 2014, the company hired Robert L. Cowan as president and CIO, who complemented and strengthened the existing team with his 30 years of experience in diversified farmland investment, acquisition and management. Acquisitions included a pecan orchard in Georgia and Alabama and second parcels expanding previously purchased properties.
In the third quarter of 2015, AFCO acquired a pistachio orchard and an additional almond orchard parcel. In October 2015, the company completed its Initial Public Offering and officially began trading on the New York Stock Exchange.
Demand for the company’s October 19, 2015 IPO was very weak, forcing the company to cut the size of its offering in half from 12.0 million to 6.0 million shares, and the price was lowered to $8 from an expected range of $8.50-$10.50. AFCO ended up raising less than $40 million at its IPO. The lead underwriters on the deal were Deutsche Bank, Raymond James, RBC Capital, and FBR Capital.
AFCO’s shares closed today at $6.50, giving the company a market value of $110 million immediately prior to the announcement.
The company said its shares “have consistently traded at a substantial discount to net asset value which, as of December 31, 2015, was estimated to be $10.05 per share.”
“The company’s net asset value is based upon independent third-party appraisals of its farms which were performed as of December 31, 2015,” it added.
American Farmland Company, a real estate company, owns and operates a portfolio of farmlands in the United States. The company operates through four segments: Permanent Crop, Specialty/Vegetable Row Crop, Commodity Row Crop, and Development.
The Permanent Crop segment consists of Kimberly Vineyard, Golden Eagle Ranch, Quail Run Vineyard, Blue Heron Farms, and Falcon Farms properties with an aggregate of 3,069 tillable acres and 3,882 gross acres.
The Specialty/Vegetable Row Crop segment includes Sandpiper Ranch and Sweetwater Farm properties with an aggregate of 1,608 tillable acres and 1,808 gross acres.
The Commodity Row Crop segment comprises Pleasant Plains, Macomb Farm, Kane County Farms, and Tillar Farms with an aggregate of 4,446 tillable acres and 4,726 gross acres.
The Development segment consists of Blue Cypress Farm, Roadrunner Ranch, Condor Ranch, Grassy Island Groves, Pintail Vineyards, and Hawk Creek Ranch properties, with an aggregate of 3,487 tillable acres and 4,962 gross acres.
The company leases its farms to professional farmer tenants under various lease structures with staggered durations, including fixed and participating leases. The trust qualifies as a real estate investment trust for federal income tax purposes.
Photo: Dixon and Arriana Boardman, at The Society of Memorial Sloan Kettering’s Special Projects Annual Dinner, October 9, 2014. (Patrick McMullan Company)