Iron Mountain IRM has gained 20 percent on news it will convert to a Real Estate Investment Trust and make a special distribution to shareholders of $600 million to $700 million.
Based on 193 million shares outstanding, the special distribution would amount to roughly $3.37 a share.
Iron Mountain provides data and document storage facilities in former mines and missile storage sites, among other locations.
It received approval for a REIT conversion from the Internal Revenue Service and its board approved the move Wednesday. REITs pay no taxes and 90 percent of its income must be distributed to investors.
Excluding the special distribution, Iron Mountain expects a full-year 2014 distribution as a REIT of between $400 million and $420 million, or a quarterly distribution of $0.52 to $0.54 per share.
Total payout related to the REIT conversion, expected January 1, will be from $1.3 billion to $1.4 billion the company said.
Additionally, Iron Mountain boosted its 2014 earnings estimate reflecting its new structure to $1.52 per share.
Iron Mountain shares are up 19.6 percent, changing hands recently at $35.62 per share.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
