The two firms signed a letter of intent last month to negotiate the acquisition, as reported by GlobeSt.com. The definitive agreement is subject to shareholder approval, customer closing conditions and ING's review of the company's books.
A spokeswoman for Apple tells GlobeSt.com that if the acquisition does close it is likely that ING will take the REIT private. Apple is currently a public company but it is not publicly traded.
Vikram Antin, an associate in Marcus & Millichap REIBC's National Hospitality Group tells GlobeSt.com that the transaction is suitably priced for a deal of that size. "$115,000 per key is roughly what ING is paying and that is a good number considering most of Apple's assets are in secondary markets." The deal will provide ING a broader national footprint, he says.
Also, he notes, Apple typically uses third party managers for its properties, which will smooth the transition for ING.
The deal is expected to close in the second quarter. McGuire Woods LLP is acting as legal advisor to Apple and UBS Investment Bank is acting as its financial advisor.
Glade Knight, president, CEO and chairman of Apple Hospitality Two formed the company in January 2001. In January 2003 it merged with Apple Suites Inc.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
