LA JOLLA, Calif., Dec. 29, 2016 (GLOBE NEWSWIRE) -- PICO Holdings, Inc. (NASDAQ:PICO) announced today that its wholly-owned subsidiary, Vidler Water Company, Inc., has agreed to sell 50,000 Long Term Storage Credits stored in the Phoenix Active Management Area of Arizona to the Central Arizona Groundwater Replenishment District, “CAGRD”, a department within the Central Arizona Water Conservation District, for gross proceeds of $12.5 million. The agreement is subject to final approval of CAGRD at its January 5, 2017 public meeting. The agreement provides for the sale to be completed in the first quarter of 2017 if all conditions and terms, including obtaining CAGRD approval, are satisfied.
The Long Term Storage Credits to be sold pursuant to this agreement are incremental to the sale of 50,000 Long Term Storage Credits which was approved by the Arizona Water Banking Authority (“AWBA”) on December 7, 2016, also for gross proceeds of $12.5 million. The two transactions are expected to close contemporaneously, assuming CAGRD approves the most recent agreement at its January 5, 2017 public meeting.
Vidler’s President and Chief Executive Officer, Dorothy Timian-Palmer commented, “Vidler is committed to working with the State of Arizona during a particularly critical time for the Colorado River, and all those who depend on the Colorado River as a water supply. Vidler expects to continue to explore opportunities for how governmental and private entities can utilize Vidler’s Long Term Storage Credits to meet their needs due to drought or for future water supply requirements.”
PICO’s President and Chief Executive Officer, Max Webb commented, “As noted at the time we announced the sale of 50,000 credits to the AWBA, our Board intends to deliberate on the optimal mechanics to return a substantial portion of the anticipated proceeds of these transactions to our shareholders upon receipt of such proceeds from the sales.”
About PICO Holdings, Inc.
PICO Holdings is a diversified holding company. Currently, we believe the highest potential return to shareholders is from a return of capital to shareholders. As we monetize assets, rather than reinvest the proceeds, we intend to return the capital derived therefrom, less any working capital requirements, back to shareholders through a stock repurchase program or by other means such as special dividends taking into effect liquidity requirements, debt covenants and any other contractual and legal restrictions that may exist at the time.
As of September 30, 2016, our two major investments were:
Vidler Water Company, Inc., a water resource development business; and a 56.9% interest in UCP, Inc. (NYSE: UCP), a publicly-traded homebuilder and land developer in markets located in California, Washington State, North Carolina, South Carolina and Tennessee.
At September 30, 2016, PICO Holdings, Inc. had a market capitalization of $272 million, and 23,069,381 shares outstanding.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Statements in this press release that are not historical, including statements regarding the gross proceeds from the sale of Long Term Storage Credits, the timing for completing the sale, our ability to satisfy all conditions and terms for the sale, opportunities for the future sale of additional Long Term Storage Credits, our business objectives, and our ability to monetize assets and return capital to shareholders through stock repurchases or through other means, are forward-looking statements based on current expectations and assumptions that are subject to risks and uncertainties.
In addition, a number of other factors may cause results to differ materially from our expectations, such as: an inability to satisfy all conditions and terms for the sale, any slow down or downturn in the housing recovery or in the real estate markets in which UCP and Vidler operate; fluctuations in the prices of water and water rights; physical, governmental and legal restrictions on water and water rights; a downturn in some sectors of the stock market; general economic conditions; prolonged weakness in the overall U.S. and global economies; the performance of the businesses; the continued service and availability of key management personnel; and potential capital requirements and financing alternatives.
For further information regarding risks and uncertainties associated with our business, please refer to the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” sections of our SEC filings, including our Annual Report on Form 10-K and our Quarterly Reports on Form 10-Q, copies of which may be obtained by contacting us at (858) 456-6022 or at http://investors.picoholdings.com.
We undertake no obligation to (and we expressly disclaim any obligation to) update our forward-looking statements, whether as a result of new information, subsequent events, or otherwise, in order to reflect any event or circumstance which may arise after the date of this press release, except as may otherwise be required by law. Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release.
This news release was distributed by GlobeNewswire, www.globenewswire.com.
Contact: Max Webb Chief Executive Officer PICO Holdings, Inc. (858) 456-6022
Source:PICO Holdings, Inc.