Tejon Ranch to Raise $75 Million for Development

Tejon Ranch Co.’s board has set the terms for a stock rights offering it expects will raise at least $75 million, the company announced Monday. Tejon, a real estate and agriculture company near Lebec, will use the proceeds for general corporate purposes, including developing buildings at industrial park Tejon Ranch Commerce Center. The money will also fund the entitlement and development process for other developments, including the housing projects Centennial at Tejon Ranch, Grapevine at Tejon Ranch and Mountain Village at Tejon Ranch. Under the offering, Tejon will distribute free of charge one transferable subscription right for each share of company stock owned by common stock holders as of 5 p.m. Oct. 4, allowing holders to buy 0.20 shares of common stock for $18 a share for each right held. If the offering is fully subscribed, Tehon expects to raise about $75 million, the company said. Stockholders who exercise all their basic subscription privilege will be able to purchase more unsubscribed shares of stock once the rights offering expires. That privilege is subject to the availability and pro rata allocation of shares among those exercising the right. If there aren’t enough unsubscribed shares to meet the requests, Tejon said it may issue up to another 833,333 of over-allotment shares to honor those who request them as part of the over-subscription privilege. Tejon said at most the sale of these extra shares would push total proceeds to about $90 million. Mailing of the offering materials should start Oct. 5 and end Oct. 27. Tejon Ranch Co. owns 270,000 acres about 60 miles north of Los Angeles and 30 miles south of Bakersfield. Shares of Tejon (TRC) closed Monday up 57 cents, or 2.8 percent, to $21.23 on the New York Stock Exchange.