Red Lion Hotels Corporation is pursuing “strategic alternatives” as part of an effort to maximize shareholder value, which could include a sale of the company or partnership with a third party, the company said Wednesday.
"The Red Lion Hotels board of directors and management team are committed to maximizing shareholder value," President and CEO Jon E. Eliassen said in a news release. "We have been working with Bank of America Merrill Lynch since mid-February, and authorizing the exploration of strategic alternatives, including a potential sale of the company, demonstrates our commitment to achieving this important objective. Our board and management team are open minded about the process and intend to evaluate all options thoughtfully and carefully."
Red Lion had 48 hotels in its portfolio as of 31 December 2011, comprising 9,010 rooms. The company’s stock price closed Wednesday at $8.07 per share, up 16.45% year to date. Red Lion’s market capitalization at Wednesday’s close was $154.72 million.
R.W. Baird analyst David Loeb told HotelNewsNow.com that a sale isn’t likely imminent and a public buyer is unlikely. Still, he said in a research note that “value could be unlocked by incorporating Red Lion's assets into a stronger brand platform or deploying much-needed capital to fund growth initiatives.”
Inland American Real Estate Trust wants its hotel portfolio to have more of an upper-upscale flavor, reports HotelNewsNow.com’s Shawn A. Turner.
The public, non-traded real-estate investment trust Wednesday announced its subsidiary closed on the purchases of five hotels, representing 2,302 rooms, for a purchase price of $393.1 million.
The properties acquired are indicative of the REIT’s desire to add upper-upscale properties to its portfolio, which numbers approximately 100 hotels and comprises brands such as Hilton Garden Inn, Residence Inn by Marriott, Courtyard by Marriott and Homewood Suites by Hilton, said Craig Lambert, executive VP of asset management for Inland American.
“We think midsize, full-service hotels with good convention and meeting space will be very successful hotels over the next two to five years,” Lambert said.
Business travel is rising, according to Embassy Suites Hotels’ Fourth Annual Business Travel Survey.
One-third of the respondents to the survey indicated they’re traveling more than they did a year ago for face-to-face meetings, and 61% of business travelers said they are extending their trip for leisure purposes at least some of the time.
Still, business travelers reported they are being more frugal while traveling, the study found. Travelers are cutting back on meals and incidentals (19%) or looking for hotels that are a “good value (22%.).”
The opportunity to purchase, renovate and rebrand hotels is here, reports HotelNewsNow.com’s Jason Q. Freed.
“It will be a very active year for repositionings,” Bob Habeeb, president and COO of First Hospitality Group, said during a webinar Wednesday. “Everyone believes that will happen in the next 12 to 18 months.”
Because many hotel owners and brands delayed renovations during the downturn, the industry is right on the cusp of continued growth, said Greg O’Stean, newly appointed principal and CFO at Access Point Financial.
“Now is the opportunity to be the best hotel on the block,” he said. “You don’t want to be the last one to offer a fresh product. You don’t want to miss that opportunity to grab market share.”
A group of travel company CEOs met with members of President Obama’s administration to express support for the President’s travel and tourism strategy and press for other initiatives to help the travel sector.
"President Obama's call for a national travel and tourism strategy was one of the most significant developments for our industry in the past decade," Roger Dow, president and CEO of the U.S. Travel Association, said in a news release. "The travel industry has the ability—and stands ready—to quickly hire many of the unemployed workers in our country, but to do that we must have policies in place that increase travel to and within the United States. This administration and most in Congress understand that, and we look forward to bipartisan support for legislation that supports America's travel industry."
Dow added, “We strongly urge the Administration to work with the House and Senate leadership to schedule a vote on the bipartisan JOLT Act, which expands the Visa Waiver Program and codifies a two-week standard for processing nonimmigrant visas.”
Compiled by Shawn A. Turner.