Data protection and information management company Iron Mountain (IRM) this afternoon said its board of directors has approved a plan to convert the company into a real estate investment trust, and that it will raise its dividend to by 8%, to 27 cents a share per quarter.
The conversion would come “no sooner than its taxable year beginning January 1, 2014,” the company said.
CEO Richard Reese remarked that “Our Board and management team believe that electing REIT status will maximize value as we advance our operating strategy.”
“A key element of our strategic plan is a disciplined capital allocation strategy to increase stockholder payouts and the REIT structure supports this plan [...] The REIT structure provides stockholders with dividends from U.S. tax savings and other increases in distributable income that will enhance stockholder returns.”
The move has been anticipated by the Street for some time now. My colleague Mike Santoli wrote on May 19th in Barron’s print edition that Iron Mountain was part of a wave of companies having converted, or considering the conversion to REIT status, including�American Tower�(AMT) and�Equinix (EQIX), to tap investors’ thirst for the group. (Subscription required to read Barron’s print articles.)
Iron Mountain shares are up $4.10, or 14.4% at $32.50 in late trading.
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