{"id":1004147429,"date":"2016-07-06T01:19:46","date_gmt":"2016-07-06T09:19:46","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004147429"},"modified":"2020-04-24T05:03:08","modified_gmt":"2020-04-24T13:03:08","slug":"apollo-funds-engaged-to-buy-diamond-resorts","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/apollo-funds-engaged-to-buy-diamond-resorts\/","title":{"rendered":"Apollo Funds Engaged to Buy Diamond Resorts"},"content":{"rendered":"<p>By Barbra Murray, Contributing Editor<\/p>\n<div id=\"attachment_1004147433\" style=\"width: 210px\" class=\"wp-caption alignright\"><a href=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2016\/07\/David-Palmer-Diamond-Resorts.jpg\" target=\"_blank\"><img loading=\"lazy\" decoding=\"async\" aria-describedby=\"caption-attachment-1004147433\" data-attachment-id=\"1004147433\" data-permalink=\"https:\/\/www.commercialsearch.com\/news\/apollo-funds-engaged-to-buy-diamond-resorts\/david-palmer-diamond-resorts\/\" data-orig-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2016\/07\/David-Palmer-Diamond-Resorts.jpg\" data-orig-size=\"200,215\" data-comments-opened=\"1\" data-image-meta=\"{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;0&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;,&quot;orientation&quot;:&quot;1&quot;}\" data-image-title=\"David Palmer, Diamond Resorts\" data-image-description=\"\" data-image-caption=\"\" data-large-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2016\/07\/David-Palmer-Diamond-Resorts.jpg?w=200\" class=\"wp-image-1004147433 size-full\" src=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2016\/07\/David-Palmer-Diamond-Resorts.jpg\" alt=\"David Palmer, Diamond Resorts\" width=\"200\" height=\"215\" \/><\/a><p id=\"caption-attachment-1004147433\" class=\"wp-caption-text\">David Palmer, Diamond Resorts<\/p><\/div>\n<p><strong>New York<\/strong>\u2014Four months after establishing a committee to explore strategic alternatives to maximize shareholder value, <a href=\"https:\/\/www.diamondresorts.com\/\" target=\"_blank\" rel=\"nofollow\">Diamond Resorts International Inc.<\/a> has found an alternative, and it\u2019s a good one. The timeshare resort company has entered into an agreement to be acquired by affiliates of certain funds managed by <a href=\"https:\/\/www.agm.com\/Home.aspx\" target=\"_blank\" rel=\"nofollow\">Apollo Global Management LLC<\/a> for $2.2 billion.<\/p>\n<p>\u201cDavid Palmer, CEO of Diamond Resorts, said in a prepared statement, \u201cWe have built a solid business focused on operational excellence, hospitality, and customer satisfaction, the result of which has been stellar financial results and strong cash generation. This transaction is an excellent outcome for\u00a0our shareholders.\u201d<\/p>\n<p>Formed in 2007, Diamond Resorts is a noted player in the hospitality and vacation ownership industry, and it has the global resort network to prove it. The company\u2019s 420-property, 13,000-unit portfolio of vacation destinations spans 35 countries, including the U.S., Canada and Mexico, as well as countries in Central America, South America, Europe, Asia, Australasia and Africa. The collection includes assets obtained as the result of the company\u2019s $84.6 million cash acquisition of Intrawest Resort Club Group, which closed in January of this year.<\/p>\n<p>The price tag on the proposal is nothing to sneeze at, but some analysts see it as justifiable. \u201cInternal financial metrics that Apollo uses supported the $2.2 billion price point, and they will likely improve on Diamond\u2019s financing and cash flow,\u201d Stephen Biggar, a director with investment and economic research provider Argus Research, told <em><a href=\"https:\/\/www.commercialsearch.com\/news\/\" target=\"_blank\">Commercial Property Executive<\/a><\/em>. In addition to the price being right, the companies are a good match. \u201cApollo is a contrarian investor in private equity,\u00a0credit and real estate. Diamond Resorts fits well within its expertise of real-estate and related hospitality franchises,\u201d he added.<\/p>\n<p>The all-cash tender offer of $30.25 per share marks a premium of roughly 26 percent over Diamond Resorts\u2019 closing share price on June 28, and more than twice that percentage over the closing share price the day the company announced the formation of a strategic alternatives committee in February.<\/p>\n<p>\u201cIt is late in the economic cycle and locking-in a 58 percent gain since February 24 is a good move at this time,\u201d C. Patrick Scholes, a managing director with corporate and investment bank SunTrust Robinson Humphrey Inc., told <em>CPE<\/em>.<\/p>\n<p>Barclays, Royal Bank of Canada, and Jefferies are furnishing financing for the transaction, and PSP Investments Credit USA LLC is also coming through with debt financing commitments.<\/p>\n<p>Diamond Resorts\u2019 board of directors has given the proposed merger the thumbs-up and is urging shareholders to support the transaction. Among those who need to sign off on the deal are FrontFour Capital Group LLC and ADW Capital Partners LP. The two significant shareholders called on Diamond Resorts CEO to explore viable alternatives, including a potential sale, back in October 2015, writing in a letter that \u201cdespite commendable execution by the management team, the company&#8217;s shares trade at their lowest valuation since being public.\u201d<\/p>\n<p>In addition to shareholders\u2019 approval of the buyout, the next steps toward completing the transaction include the customary closing conditions, but that\u2019s not all. There\u2019s a minimum tender condition dictating that more than 50 percent of Diamond Resorts\u2019 commons shares be tendered.<\/p>\n<p>If all goes as planned, Apollo\u2019s acquisition of Diamond Resorts will close within the next few months, after which the vacation ownership company will be taken private.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Apollo Global Management is set to acquire the resort company for a whopping $2.2 billion.<\/p>\n","protected":false},"author":969,"featured_media":1004147433,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21743,21808,21751,21783,23891,1600,21742,10],"tags":[],"class_list":["post-1004147429","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-deals","category-featured","category-hotel","category-investment","category-national","category-new-york","category-latest","category-northeast"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.4 (Yoast SEO v24.6) - 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