Private Equity Firm Purchases Las Vegas Resort Diamond Resorts
Diamond Resorts International recently announced that it has entered into a sale agreement estimated to be around $2.2 billion with a private equity firm. Diamond Resorts is a Las Vegas-based timeshare resort company that has a network of around 420 properties spread across 35 countries.
The company stated that it has entered into an agreement with the affiliate entities of private equity firm Apollo Global Management and would complete an all-cash sale. Diamond’s major properties in Las Vegas include the Cancun Resorts Las Vegas situated on Las Vegas Boulevard South and the Polo Towers on the Strip.
The deal price represents a premium of 26 percent over its latest stock price and is higher by 58 percent over its price in February when it had first declared its intention to explore possible options for selling out. Diamond CEO David Palmer said that the company had been built with a strong focus on operational excellence, customer satisfaction and hospitality, resulting in strong cash positions and excellent financial results.
In a statement David Sambur Apollo partner said,
Stephen (Cloobeck, Diamond’s founder), David (Palmer), the management team and Diamond’s more than 8,000 team members have built an amazing customer-centric business with a great reputation that delivers award-winning hospitality experiences at great value. We look forward to bringing Apollo’s resources to bear and working with the Diamond Resorts team to continue to grow and enhance their business.
The deal is expected to be finalized in the next couple of months. Apollo is a global private equity firm with operations worldwide. The company manages around $173 billion in private equity, real estate and credit funds that have been invested in companies in nine industries where Apollo claims it has substantial experience
Despite the deal having price premium over current stock value, two law firms have filed a lawsuit alleging that the deal was not a fair price and Diamond’s management team had violated their fiduciary duty by not pursuing a higher deal value.
Johnson & Weaver a law firm based in San Diego is one of the firms that have launched an investigation into the agreement. The other firm is Andrews & Springe based in Wilmington, Delaware which has also launched a similar investigation based on the terms agreed upon by Diamond.
The law firms are probing to establish if $30.25 a share was a fair price. Johnson & Weaver have pointed to a report by a Wall Street analyst which put the target price for Diamond’s share at $35 a share. The company’s shares are currently trading in the range of $29.
Hi, I am the Chief Editor of top10casinowebsites.net, this site is dedicated to all thing casino. I have been working around the casino industry for the last 12 years, with different brands. The main purpose of this site is to keep you informed with the latest news and offers around