Red Lion Hotels to Acquire Vantage Hospitality Group
Red Lion Hotels Corporation (“RLHC” or the “company”), a hospitality company that operates and franchises upscale, midscale and economy hotels, announced it entered into a definitive agreement to acquire the global brands and brand operations of Vantage Hospitality Group Inc. (“Vantage”) based in Coral Springs, Fla., for an initial aggregate price of $23 million in cash and 690,000 shares of the company’s common stock, which closed at $6.96 per share.
Additional aggregate compensation of up to $7 million in cash and an additional 690,000 shares may be earned contingent upon the achievement of certain performance metrics at the first and second anniversaries of the transaction. The additional consideration includes a $1 million minimum cash payment on the first and second anniversaries. RLHC expects the transaction to be earnings accretive in the twelve months immediately following the closing. The transaction is subject to customary closing conditions and expected to close in the fourth quarter of 2016.
“The acquisition of Vantage Hospitality Group’s operations establishes RLHC as one of the largest hotel franchisors adding approximately 1,000 hotel franchise, membership, and licensing agreements to our growing brand family,” commented Greg Mount, president and chief executive officer of RLHC. “Vantage has built a distinctive and highly successful platform over the last 16 years owing to a strong culture that emanates from its leaders. As such, Vantage’s current leadership and staff in Coral Springs will become the hub for all RLHC select service brand operations. We look forward to harnessing our collective strengths to drive growth for our franchisees, superior service for our guests and accretion for our shareholders.”
Vantage Hospitality Group, founded in 1999, is one of the largest private hotel franchisors in the country. RLHC will acquire substantially all of the hospitality-related assets and operations of Vantage and its parent company used in connection with the businesses conducted under the following names, as well as their brand extensions and international counterparts: Vantage Hotels; Americas Best Value Inn; Canadas Best Value Inn; Lexington by Vantage; America’s Best Inns and Suites; Country Hearth Inns; Jameson Inns; Signature Inn; and 3 Palms Hotels & Resorts. The assets include, but are not limited to the membership, franchise, and license agreements, equipment and machinery, customer lists, trademarks and tradenames, records, supplies and accounts receivable of the business.
Additional aggregate compensation of up to $7 million in cash and an additional 690,000 shares may be earned contingent upon the achievement of certain performance metrics at the first and second anniversaries of the transaction. The additional consideration includes a $1 million minimum cash payment on the first and second anniversaries. RLHC expects the transaction to be earnings accretive in the twelve months immediately following the closing. The transaction is subject to customary closing conditions and expected to close in the fourth quarter of 2016.
“The acquisition of Vantage Hospitality Group’s operations establishes RLHC as one of the largest hotel franchisors adding approximately 1,000 hotel franchise, membership, and licensing agreements to our growing brand family,” commented Greg Mount, president and chief executive officer of RLHC. “Vantage has built a distinctive and highly successful platform over the last 16 years owing to a strong culture that emanates from its leaders. As such, Vantage’s current leadership and staff in Coral Springs will become the hub for all RLHC select service brand operations. We look forward to harnessing our collective strengths to drive growth for our franchisees, superior service for our guests and accretion for our shareholders.”
Vantage Hospitality Group, founded in 1999, is one of the largest private hotel franchisors in the country. RLHC will acquire substantially all of the hospitality-related assets and operations of Vantage and its parent company used in connection with the businesses conducted under the following names, as well as their brand extensions and international counterparts: Vantage Hotels; Americas Best Value Inn; Canadas Best Value Inn; Lexington by Vantage; America’s Best Inns and Suites; Country Hearth Inns; Jameson Inns; Signature Inn; and 3 Palms Hotels & Resorts. The assets include, but are not limited to the membership, franchise, and license agreements, equipment and machinery, customer lists, trademarks and tradenames, records, supplies and accounts receivable of the business.