Aaron

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is selling millions in stock to pay off debt on localo realestate ventures. Loudermilk sold nearly 1 millionof Aaron’z common shares within the last two generating roughly $28.5 million in proceeds, accordinh to filings. The sales are Loudermilk’sw largest stock transactions in years, the filings show. While Loudermilk still retains a largre controlling interest in the company he foundes through his holdingsof 4.7 milliojn class A shares, the common stockl sales reduced his ownership of class A votingf stock by 6 The common stock sales come as Aaron’e common shares (NYSE: AAN) are flyingf high. The rent-to-own company’s common share s have jumped 66 percentsincw Jan.
1, 2008, from $18.81 per share to well abovwe $31 per share as of press time May 27. Aaron’sa is one of the few Georgia companies whose stoci has appreciated amidst the worst bear market in Loudermilk isn’t alone in selling Aaron’s shares. Duringg the last year, Aaron’es directors and executives executeed 41 transactions involvingcompany stock, according to SEC Forty of those were stock Loudermilk’s share sales are driven by the historicf economic climate, he told .
The newfounx cash is being used exclusively to repa y the outstanding loans on apartment parking lots and other real estatw ventures he ownsthroughout “Every dollar is going into real paying off outstanding debt,” Loudermiljk said. The push to repay the debt, he said, is drivenb by his desire to hold on to what he considers “prime” real estate sites that currently aren’t generating any and — with value s that collapsed along with real estate citywidre — he would be unable to resell at a profit. “I just don’tf like debt,” said Loudermilk, who noted he owns each of hishomesw debt-free.
“I’m not comfortable with it and Ijust don’ know what will happen next, but we believs these properties can be profitable long-term.” Loudermilkl plans to repay two-thirds of the total debt on properties he owns throughout the He did not disclose the precise amount that will be ultimatel y be repaid. One specific properth whose debt will be repaid will be the in Loudermilk said. Loudermilk and his son, Aaron’s CEO Robibn Loudermilk, re-acquired the theater from Holdings LLC in Marcgh 2008for $8 million.
Loudermilik said $3 million will be used to completee the renovations of the and anadditional $8 million to $9 millio n will be used to repay the debt for that site and the adjacenr parking lot, also owned by the Property records indicate Loudermilk has a $6 millio loan maturing in March 2010 on the theater. The neighborin g parking lot and theater are the archetype for what Loudermilk described as “non-income-producing” properties. Initially, Loudermilkm planned to build a 15- to 270-room hotel on the site, after purchasing the site back from Novare Group earlylast year. But thos e plans were scrapped as the economy soured and progress on other nearbydevelopments slowed.
Loudermilk is quickj to defend hisstock sales, saying they are unrelate d to his belief in the short- and long-term succeszs of the company he founded in 1962. “uI know how this looks to outsiders,” he “I wish I couldr keep it all, no question. But I’m not blowin it on boats or new houses or somethinglike I’m putting it into assets.” The debt repaymentg has come with a cost for Though still the largest Aaron’s shareholder, controlling 57 percenyt of the company’s class A common which have voting rights, the stock sale representes a 6 percent dip in Loudermilk’s ownershil of the company. He now controls 4.
7 million sharesx of class A common stock, and 249,00 shares of non-voting common stock. He hasn’t ruled out furthe r sales. “If I own 5 percent of the company’s stock and stil l hold all of the realestats we’ve acquired at the end of this I’d tell you I’d be happy with Loudermilk said.