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PREIT To Buy Crown American, Analysts Say

A delayed earnings announcement was all it took to get Wall Street tongues wagging. Now, they’re saying PREIT has probably acquired Johnstown, Pa.-based Crown American Realty Trust and is putting off its quarterly report as it is updated to reflect the acquisition. Crown, which traditionally has announced first quarter earnings during the third week in April, has yet to report or even schedule a conference call. Why? The most probable answer, says Citigroup Smith Barney analyst Jonathon Litt, is that there won’t be one.

Crown previously acknowledged it incurred a $0.02 cost per share to evaluate strategic alternatives, while PREIT admitted it is looking to acquire a large portfolio after its recent acquisition of a handful of Rouse Co. malls. Litt estimates PREIT could pay $7.29 per share, based on a 10.5 percent cap rate on fourth quarter 2002 NOI and a 20 percent cap rate on other income. Crown currently has 41.9 million shares outstanding.

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