BlackRock dives into ARCP

The fund giant has taken a major position in the beleaguered real estate investment trust, American Realty Capital Properties Inc., or ARCP.

Fund giant BlackRock Inc. has taken a major position in the beleaguered real estate investment trust, American Realty Capital Properties Inc., or ARCP.
In a Thursday filing with the Securities and Exchange Commission BlackRock said it had acquired close to 60 million ARCP shares, a 6.6% equity stake.
It’s the second time in a month that a large institutional investor has taken a major stake in ARCP; at the end of December, Corvex Management, run by Carl Icahn acolyte Keith Meister, said it had acquired 64.7 million ARCP shares, or 7.1% of the company’s shares. According to Morningstar Inc., the Corvex and BlackRock positions make them, respectively, the second and third largest shareholders of ARCP, according to ownership tallies dating to the end of September. At that date, Vanguard Group Inc. was the largest equity owner of ARCP, with almost 120 million shares held, or 13.2% of the total.
Corvex is known as an activist investor while BlackRock is not.
In its filing, BlackRock did not identify which of its funds bought the ARCP shares.
BlackRock spokeswoman Katherine Ewert did not immediately return a call seeking comment on the filing.
A lot has changed for ARCP since those September numbers for equity ownership were reported. At the end of October, ARCP announced that it had intentionally left uncorrected a $23 million accounting error over the first half of 2014. Two executives resigned immediately; later, in the middle of December, ARCP chairman and founder Nicholas Schorsch and chief executive David Kay resigned.
The value of the company’s stock has plummeted, falling 26% from Oct. 28 to Friday, when it was trading at $9.21 per share.