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The joint venture between Blackstone and Starwood Capital will acquire Extended Stay America (STAY) for $19.50 per paired share, totaling approximately $6 billion. This acquisition presents a 51% premium to pre-pandemic valuations, emphasizing immediate value for shareholders. The Boards strongly support this transaction, indicating it aligns with Extended Stay's strategic objectives while minimizing execution risks and capital needs. The company has a history of exploring value-enhancement alternatives, with this acquisition deemed the most beneficial for shareholder interests.
Extended Stay America (ESA) and ESH Hospitality announced a definitive agreement for a joint venture acquisition by Blackstone and Starwood Capital for $19.50 per paired share, valued at approximately $6 billion. The Boards believe this transaction provides a compelling return for shareholders. The forthcoming proxy statement will detail the transaction's background and reasoning, urging shareholders to review it thoroughly. This acquisition positions ESA favorably within the market, reinforcing its status as a leading player in the mid-priced extended stay segment.
Tarsadia Capital, a major shareholder of Extended Stay America (STAY), with 3.9% ownership, opposes the company's proposed sale to Blackstone and Starwood for $19.50 per share. Tarsadia argues the transaction undervalues the company and occurs just as the lodging industry begins recovery post-COVID-19. They suggest alternative strategies and have nominated three independent executives for the board to enhance ESA's performance. Tarsadia believes the proposed sale disregards potential value creation opportunities for shareholders.
On March 15, 2021, Extended Stay America (ESA) and its paired-share REIT, ESH Hospitality (NASDAQ: STAY), announced a definitive agreement to be acquired by a joint venture of Blackstone Real Estate Partners and Starwood Capital Group for $19.50 per paired share, totaling approximately $6 billion. This price represents a 23.3% premium over the 30-day average share price. The transaction, unanimously approved by the boards, is expected to close in Q2 2021, pending stockholder approval. A special distribution may be requested prior to closing, potentially reducing merger cash consideration.
Extended Stay America, Inc. (NASDAQ:STAY) reported a net income of $65.7 million for Q4 2020, a significant increase compared to $23.8 million in Q4 2019. The company saw total revenues of $259.3 million, reflecting an 8.8% decline year-over-year. The full year 2020 net income was $96.3 million, down from $165.1 million in 2019. Comparable system-wide RevPAR fell 9.4% in Q4 and 15.0% for the full year. The RevPAR index improved significantly by 40% in Q4. ESH Hospitality announced a $0.09 distribution per paired share, payable on March 26, 2021.
Extended Stay America announces the launch of its new brand, Extended Stay America Premier Suites, with plans for over 30 properties. Targeting higher-rated extended-stay guests, the Premier Suites will feature upgraded amenities and a daily rate between $80 and $100. Alongside this, the company will rebrand existing hotels to Extended Stay America Suites. This strategic move aims to enhance brand communication, attract new customers, and optimize franchise growth.
Extended Stay America (NASDAQ:STAY) has added three new properties in Oklahoma through franchise conversions, owned by Provident Realty Advisors and managed by Aimbridge Hospitality. The new locations include Bartlesville, McAlester, and Lawton, enhancing ESA's footprint in the state. Each hotel features amenities such as complimentary Wi-Fi, fully equipped kitchens, and on-site fitness options. With 649 hotels nationwide, Extended Stay America continues to lead the mid-priced extended stay segment and focuses on growing its franchise operations.
Extended Stay America is the exclusive hospitality partner for season 25 of Military Makeover with Montel, airing on Lifetime TV. The company provided accommodation for Army Staff Sergeant Daniel Burgess and his family during their home renovation. The show highlights the Burgess family's journey and experience at the Port Charlotte hotel, which includes fully furnished suites and amenities. Extended Stay America's commitment to veterans is demonstrated through various programs and support for military families. The season premieres on February 12, 2021, featuring the family's story.
Extended Stay America, Inc. (Nasdaq: STAY) announced it will release its fourth quarter results after the market closes on February 25, 2021. A conference call is scheduled for February 26, 2021, at 8:30 a.m. ET to discuss the quarter's performance and recent developments. Additionally, the Company will hold its 2021 Annual Meeting of Shareholders on May 26, 2021. Detailed information will be available on the investor relations section of the Company’s website.
On January 28, 2021, Extended Stay America and ESH Hospitality (NASDAQ:STAY) announced the tax treatment for 2020 distributions of $0.26 per paired share to shareholders. Of this amount, $0.16 per Class A and Class B common share was classified as 100% Ordinary Income and Section 199A Qualified Business Income. Meanwhile, $0.10 per common share from Extended Stay America was categorized as a 100% Qualified Dividend. Shareholders are advised to consult their tax advisors regarding these distributions.
