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Insight Comment |
Highgate and Cerberus Capital Management are teaming up to buy CorePoint Lodging in a $1.5 billion all-cash transaction.
CorePoint, a select-service hotel owner focused on the midscale and upper-midscale segments, was spun off from La Quinta, before that business was sold to Wyndham.
The transaction is expected to close in the first quarter of 2022, subject to the approval of CorePoint’s shareholders. As part of the deal, Blackstone, which owns around 30% of CorePoint’s total shares outstanding, has agreed to vote in favour of the deal.
CorePoint shareholders are expected to receive $15.65 per-share in cash.
Corepoint’s portfolio mostly consists of La Quinta branded properties.
The company had been in a long-running dispute with Wyndham. The pair have now come to an agreement concerning the termination of all remaining Wyndham hotel management agreements upon competition of the takeover deal.
What They Said
Keith Cline, CEO, CorePoint: “Over the past few years, CorePoint has been executing on a disciplined asset disposition strategy that has transformed the Company’s portfolio and created substantial value. This transaction continues our strategy of maximizing value and represents a compelling opportunity to deliver immediate and certain cash value to our stockholders.
“Our portfolio has accomplished a great deal over the past several years, and I would like to thank the entire team at CorePoint along with Wyndham, especially their operations field leaders, general managers and hotel staff, for the dedication, hard work and commitment to CorePoint.”
Mahmood Khimji, co-chairman, Highgate: “Highgate has tremendous respect for CorePoint and its highly experienced team, having observed the Company strengthen, refine and cultivate a leading portfolio of select service hotels. We are thrilled to partner with our friends at Cerberus on another exciting transaction, through which Highgate will continue to enhance its capabilities in the select service space.
“We look forward to collaborating with the many associates and stakeholders involved towards a successful closing, and to working closely with the Wyndham Hotels team as we embark on the next chapter for this portfolio.”
Tom Wagner, head of North American real estate, Cerberus: “Since separating from La Quinta Holdings, Inc. in 2018, the CorePoint management team has done an excellent job running the business, navigating the unprecedented COVID-19 pandemic, and strategically repositioning its portfolio. Alongside Highgate, we are excited for the opportunity to build on these positive strides and establish the Company’s next chapter of growth as a private company.”