Newhall Land Plan to Buy Back Investor Units OKd

Newhall Land & Farming Co. said a Los Angeles Superior Court judge has approved its plan to repurchase at least $40 million of its partnership units to help settle a class-action lawsuit brought by dissident investors.

Newhall, which first announced the plan Sept. 30, is a real estate and agricultural concern based in Valencia. The company is organized as a limited partnership whose units, which are similar to shares of stock, are traded on the New York Stock Exchange.

The settlement calls for Newhall to buy back the units over 18 months and to pay a special distribution of 30 cents per unit to all unit-holders of record as of Sept. 28. Judge Barnet M. Cooperman also ordered Newhall to pay $2 million to the dissidents for legal fees and other expenses.

Newhall said that although certain unit-holders can appeal the settlement during the next 60 days, it plans to start implementing the settlement “as soon as practicable.” Based on present prices, its repurchase of $40 million worth of units would involve about 4.2% of its 19.8 million total units outstanding.

The dissidents filed suit in May to block the addition of five anti-takeover provisions to Newhall’s partnership agreement. Newhall’s unit-holders approved the measures at management’s urging. But the dissidents argued that the new rules would entrench management and prevent investors from getting a higher price for their units through a merger.