Post by anenro on Aug 15, 2015 17:21:32 GMT 4
Bill Gates Makes a Play To Acquire Strategic Hotels & Resorts
Tech billionaire turned philanthropist Bill Gates is setting his sights on his Kirkland, WA-based neighbor Strategic Hotels & Resorts Inc., a REIT that owns 18 high-end hotels in the U.S. and Germany.
The billionaire’s investment firm, Cascade Investment Inc., disclosed in a regulatory filing that it has amassed 1.74 million shares of Strategic Hotels & Resorts Inc.’s common stock on the open market at an aggregate purchase price of $21.45 million. Gates, the sole member of Cascade, now owns 9.8% of the outstanding shares of the REIT.
Cascade acquired its stake in Strategic prior to Bloomberg News reporting last month that the REIT was considering a potential sale and had engaged a bank to assist in evaluating its options. That prompted Cascade to say it would be interested in discussing any potential sale of the company.
"In light of the possibility that the issuer (Strategic) is exploring a potential sale transaction as noted in recent press reports, the reporting persons have determined to approach the issuer about the possibility of exploring strategic alternatives for the issuer, including the possibility of the reporting persons being a party to a transaction involving the acquisition of the issuer," Cascade announced in its filing. "Such discussions may lead to the reporting persons participating in such a transaction. There is no assurance that any such transaction will in fact occur."
This week, after Gates disclosed his interest, Strategic Hotels stock has traded up to about $14.23 a share. That bump increased the value of Gates’ shares by about $50 million.
At that share price, Strategic Hotels has a market capitalization value of $3.9 billion. In its quarterly report ended June 30, Strategic Hotels listed the asset value of its hotels at $3.28 billion.
Gates said he would consider acquiring additional shares and continue to seek to engage REIT’s management and other shareholders in discussions concerning the business and strategic direction of the Strategic Hotels.
The hotel owner has posted revenues of $682.2 million for the six month period ended June 30, 2015, a 44.9% increase over the prior year period, primarily driven by the acquisitions of the Four Seasons Resort Scottsdale at Troon North, the Montage Laguna Beach resort and the Four Seasons Hotel Austin, as well as the consolidation of the Hotel del Coronado and the Fairmont Scottsdale Princess resort.
Comparable FFO was 45 cents per diluted share compared with 28 cents for the six-month period a year earlier.
In May, Strategic Hotels acquired the Four Seasons Hotel Austin for $197 million and sold the Hyatt Regency La Jolla hotel for $118 million.
Last month, the hotel REIT acquired the remaining 49%t ownership interest in the JW Marriott Essex House hotel at an implied valuation of $84.6 million.
As of June 30, 2015, the REIT controlled interests in or leased the following 18 hotels:
1. Fairmont Chicago
2. Fairmont Scottsdale Princess
3. Four Seasons Hotel Austin
4. Four Seasons Jackson Hole
5. Four Seasons Resort Scottsdale at Troon North
6. Four Seasons Silicon Valley
7. Four Seasons Washington, DC
8. Hotel del Coronado
9. InterContinental Chicago
10. InterContinental Miami
11. JW Marriott Essex House Hotel
12. Loews Santa Monica Beach Hotel
13. Marriott Hamburg
14. Marriott Lincolnshire Resort
15. Montage Laguna Beach
16. Ritz-Carlton Half Moon Bay
17. Ritz-Carlton Laguna Niguel
18. Westin St. Francis
Tech billionaire turned philanthropist Bill Gates is setting his sights on his Kirkland, WA-based neighbor Strategic Hotels & Resorts Inc., a REIT that owns 18 high-end hotels in the U.S. and Germany.
The billionaire’s investment firm, Cascade Investment Inc., disclosed in a regulatory filing that it has amassed 1.74 million shares of Strategic Hotels & Resorts Inc.’s common stock on the open market at an aggregate purchase price of $21.45 million. Gates, the sole member of Cascade, now owns 9.8% of the outstanding shares of the REIT.
Cascade acquired its stake in Strategic prior to Bloomberg News reporting last month that the REIT was considering a potential sale and had engaged a bank to assist in evaluating its options. That prompted Cascade to say it would be interested in discussing any potential sale of the company.
"In light of the possibility that the issuer (Strategic) is exploring a potential sale transaction as noted in recent press reports, the reporting persons have determined to approach the issuer about the possibility of exploring strategic alternatives for the issuer, including the possibility of the reporting persons being a party to a transaction involving the acquisition of the issuer," Cascade announced in its filing. "Such discussions may lead to the reporting persons participating in such a transaction. There is no assurance that any such transaction will in fact occur."
This week, after Gates disclosed his interest, Strategic Hotels stock has traded up to about $14.23 a share. That bump increased the value of Gates’ shares by about $50 million.
At that share price, Strategic Hotels has a market capitalization value of $3.9 billion. In its quarterly report ended June 30, Strategic Hotels listed the asset value of its hotels at $3.28 billion.
Gates said he would consider acquiring additional shares and continue to seek to engage REIT’s management and other shareholders in discussions concerning the business and strategic direction of the Strategic Hotels.
The hotel owner has posted revenues of $682.2 million for the six month period ended June 30, 2015, a 44.9% increase over the prior year period, primarily driven by the acquisitions of the Four Seasons Resort Scottsdale at Troon North, the Montage Laguna Beach resort and the Four Seasons Hotel Austin, as well as the consolidation of the Hotel del Coronado and the Fairmont Scottsdale Princess resort.
Comparable FFO was 45 cents per diluted share compared with 28 cents for the six-month period a year earlier.
In May, Strategic Hotels acquired the Four Seasons Hotel Austin for $197 million and sold the Hyatt Regency La Jolla hotel for $118 million.
Last month, the hotel REIT acquired the remaining 49%t ownership interest in the JW Marriott Essex House hotel at an implied valuation of $84.6 million.
As of June 30, 2015, the REIT controlled interests in or leased the following 18 hotels:
1. Fairmont Chicago
2. Fairmont Scottsdale Princess
3. Four Seasons Hotel Austin
4. Four Seasons Jackson Hole
5. Four Seasons Resort Scottsdale at Troon North
6. Four Seasons Silicon Valley
7. Four Seasons Washington, DC
8. Hotel del Coronado
9. InterContinental Chicago
10. InterContinental Miami
11. JW Marriott Essex House Hotel
12. Loews Santa Monica Beach Hotel
13. Marriott Hamburg
14. Marriott Lincolnshire Resort
15. Montage Laguna Beach
16. Ritz-Carlton Half Moon Bay
17. Ritz-Carlton Laguna Niguel
18. Westin St. Francis
