REIT Ashford's offer for FelCor "inadequate", says activist investor

Ashford

27/02/2017 14:51

Feb 27 (Reuters) - Lodging REIT Ashford Hospitality Trust 
Inc's  AHT.N  offer to buy FelCor Lodging Trust Inc  FCH.N  was 
"woefully inadequate", activist hedge fund Land and Buildings 
Investment Management LLC, which holds a stake in FelCor, said 
on Monday. 
    Ashford offered to buy FelCor last week, in a deal valued at 
about $1.27 billion, and launched a proxy battle for the control 
of the company's board.  urn:newsml:reuters.com:*:nL4N1G64N6 
    Land and Buildings, which owns 6.1 percent of FelCor's 
shares, estimated the company's net asset value at $10.50 per 
share, well above Ashford's offer price of $9.27 per share in 
stock and warrants.  urn:newsml:reuters.com:*:nBw1b0YHZa 
    The hedge fund also said any offer by Ashford should consist 
of at least $5 per share in cash, which is roughly the cash 
balances at Ashford and its external manager Ashford Inc 
 AINC.A . 
    FelCor's shares were up 1.8 percent at $7.21. Ashford's 
shares, on which FBR raised its rating to "outperform" from 
"market perform", jumped 4.7 percent to $6.71. 
    Up to Friday's close, Felcor's shares had fallen about 2 
percent, since Feb. 17, the last trading day before Ashford made 
its offer. Ashford's shares have dropped about 16 percent in 
that period. 
 
 (Reporting by Ankit Ajmera in Bengaluru; Editing by Savio 
D'Souza) 
 ((ankit.ajmera@thomsonreuters.com; within U.S. +1 646 223 8780, 
outside U.S. +91 80 6749 3067; Reuters Messaging: 
ankit.ajmera.thomsonreuters.com@reuters.net)) 
 
Keywords: FELCOR M&A/