Apple Hospitality REIT and Apple REIT Ten Shareholders to Vote on Planned Merger
Apple REIT Ten Inc., a publicly registered non-traded real estate investment trust, and Apple Hospitality REIT Inc. (NYSE: APLE) are asking shareholders to vote on their $1.3 billion planned merger that was announced in April. Both shareholder meetings are scheduled on August 31st.
The proposed transaction joins two select service hotel portfolios that will total 236 hotels with 30,298 guestrooms throughout 33 states. The combined company is expected to have an enterprise value of approximately $5.7 billion and a total equity market capitalization of approximately $4.3 billion.
At the Apple Hospitality meeting, shareholders will be asked to vote on a proposal to issue 49.1 million Apple Hospitality common shares to Apple Ten shareholders, as well as pay $94 million in cash. In addition, Apple Hospitality will assume all of Apple Ten’s assets and liabilities at the merger’s closing. As of March 31, 2016, the estimated fair value of the company’s debt was $238.4 million.
At the Apple Ten meeting, shareholders will vote on the proposed merger. If approved, they will receive $1.00 in cash for each Apple Ten “unit,” which consists of one common share and one series A preferred share. Each unit would be converted into a fixed exchange ratio of 0.522 Apple Hospitality common shares.
If approved by shareholders, the combined company will retain the name Apple Hospitality REIT and will continue to trade on the NYSE under the symbol “APLE.”
The merger is expected to close in the third quarter of 2016.
