On Feb. 21, Winston agreed to merge with Wilbur Acquisition Holding, a limited liability company held by affiliates of Och-Ziff Real Estate and Norge Churchill, Inc. The deal put the total dollar amount at $430.1 million, or $14.10 per share. Two weeks later, Inland American upped the ante with its own $15-per-share bid, as GlobeSt.com previously reported.
After weighing both offers, Winston's board of directors and an independent special committee of the board threw its support behind Oak Brook, IL-based Inland. As a result, Winston executives say the company has complied with the termination provisions of the Wilbur agreement, including the payment of termination fees and reimbursement of expenses. Winston executives expect, in turn, to be reimbursed by Inland, according to a release.
According to a release from Inland American, the total acquisition price is approximately $850 million including transaction costs. Under the terms of the agreement, each share of Winston common stock will be converted into the right to receive $15 in cash. In addition, each share of company Series B preferred stock will be converted into the right to receive $25.44 per share, or $25.38 per share if the effective time of the merger occurs after June 30, and on or prior to Sept. 30, in cash, plus any accrued and unpaid dividends as of the effective time of the merger, the release states.
Inland American intends to fund the merger with cash on hand, and the completion of the merger is not subject to any financing or refinancing contingency. The deal is expected to close in the third quarter.
"The board of directors and the special committee of outside directors are pleased that the sale process has been structured in a manner that they believe provides the opportunity for the greatest benefit to our shareholders," Robert W. Winston III, chief executive officer of Winston, says in a statement.
Joseph V. Green, president and chief financial officer of Winston, adds, "The increased purchase price per share of common stock validates the momentum that we believe not only is behind our portfolio but also all of our growth strategies."
As of Dec. 31, Winston owned or was invested in 53 hotel assets, with a total room count of 7,205. The assets are spread across 18 states.
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