American Farmland Company has filed an amended S-11 form with the U.S. Securities and Exchange Commission (SEC) regarding its initial public offering. In the filing 12 million units are being offered in an expected price range of $8.50 to $10.50, with an overallotment option for an additional 1.8 million units. At the maximum price, the entire offering is valued up to $144.9 million. The company intends to file on the New York Stock Exchange under the symbol AFCO.

The underwriters for the offering are Deutsche Bank, Citigroup, Raymond James, RBC Capital Markets, FBR, Janney Montgomery Scott, Oppenheimer and Wunderlich.

This is an internally managed real estate investment trust (REIT) that owns a diversified portfolio of high-quality farmland, consisting of mature permanent, specialty/vegetable row and commodity row crop farms, as well as farmland development projects, which is located in select major agricultural regions in the United States.

Basically, the company invests in the U.S. agricultural sector, not necessarily in development, but to generate rental income and have the potential for capital appreciation. Land operated or owned as part of a farm in the country as of the end of 2014 was more than $2.7 trillion, and the total value of agricultural sector production grown in 2014 was estimated to be $465 billion.

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In the filing the company said:

We seek to provide our stockholders with a combination of (i) current income from renting our stable portfolio of mature farms and (ii) capital appreciation, partially driven by our ability to develop properties to maximize their value. We lease our farms to professional farmer tenants under a variety of lease structures with staggered durations, including fixed and participating leases, which typically consist of fixed base rent and participating revenue components. Approximately 45.6% of our 2014 contractual rent and 50.1% of our contractual rent through the second quarter of 2015 was comprised of fixed and base rent, some of which has annual escalators. In addition, our participating leases typically require our professional farmer tenants to obtain crop insurance, which seeks to protect the stability of our cash flow. We are a Maryland corporation and aim to be the leading farmland REIT to be traded on a U.S. stock exchange with a highly diversified portfolio, scalable platform and a unique investment focus on permanent, specialty/vegetable, development and commodity row crop farmland throughout the U.S.

The company intends to contribute the net proceeds from this offering to its operating partnership in exchange for common units. The operating partnership intends to use the net proceeds from this offering to pay down its revolving credit facilities, for working capital and for general corporate purposes.

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