Becker Boards Releases Letter to Directors and Unitholders of LMRK Seeking Breakup of LMRK
Becker Boards, L.L.C. Managing Member Mark D. Becker issued the following letter:
August 11, 2021
VIA FEDEX
Mr. Steven Sonnestein
Chairman of the Board
Landmark Infrastructure Partners LP
400 Continental Blvd, Suite 500
El Segundo, CA 90245
Dear Members of the Board of Directors:
Becker Boards, L.L.C., an Arizona limited liability company and the Mark D. Becker 401k Plans ("Becker", "we", "us" or "our") hold in excess of 550,000 common units in Landmark Infrastructure Partners L.P. ("Landmark"). Mark D. Becker, our Managing Member, sole owner and/or beneficiary, as applicable, is active in the outdoor advertising business. We first learned of Landmark several years ago when Landmark sent an unsolicited letter to us inquiring if we'd be interested in selling our landlord's interest in one or more of the billboards that we or one or more of our affiliates owned.
We were greatly impressed with Landmark's portfolio of landlord's interests in billboard and cell tower leases, as we fully understand the challenges involved in such an assemblage. Because of this, the then favorable dividend rate and policy, and the below market value of the units, we began to accumulate units several years ago. As acknowledged by the CEO on several earnings calls, the master limited partnership structure of Landmark has always been problematic and one, if not the major, reason why the units currently trade well below their intrinsic value as they always have done.
Decision To Sell The Assets of Landmark
Because of this structural organizational issue of Landmark as a master limited partnership and its inability, despite years of efforts, to grow its way into a size large enough to convert to a REIT, it has become apparent to all that the assets of Landmark should be sold. We commend the new general partner for recognizing this fact and initiating the process by offering to buy the assets at a valuation which would pay the unit holders $13 per unit. Both Verde's $13.50 offer and Melody's subsequent offer of $16.25 per unit stated willingness to likely pay more after a brief due diligence period. These three offers confirm the wisdom of the asset sale strategy. At this point, we believe that any action to abandon or delay sale of the assets of Landmark, as initiated by the general partner, would be illogical, contrary to the best interests of the unit holders and likely a breach of the board's duty to act in good faith. The acceptance of the original $13 per unit offer would also be inexplicable and highly inappropriate. We have been patient unit holders for many years and ask that the independent committee undertake a process that treats us fairly and obtains the best price for Landmark's unit holders.
Valuation
In that regard, we request that the independent committee members of the board undertake a formal process to sell the assets to one or more qualified parties at the highest price. Given that Landmark has three distinct asset classes (telcom, billboards and data centers), the best price might be obtained by selling the distinct asset classes to companies that specialize in each area. However, if the process results in one company paying the highest price for all the assets, that's fine as well. We are happy to see that the board hired a well-qualified investment banker to evaluate the general partner's offer but it is time to expand that scope of inquiry and create a formal process to obtain bids for the assets and help negotiate to obtain the best overall price for the unit holders.
While the board and the investment bankers are undertaking these tasks, we also ask that Landmark: (i) refrain from acquiring any more assets, (ii) re-institute its normal pre-pandemic dividend policy and rate, recognizing that the current rate is artificially low, and (iii) curtail any non-contractually obligated spending on DART, Flex-grid and any other endeavors.
Thank you for your consideration of these requests.
Sincerely,
Mark D. Becker
About Becker Boards
Becker Boards, L.L.C. is an Arizona limited liability company that specializes in the operation of billboards in several major markets in the U.S. www.BeckerBoards.com
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