Host Hotels & Resorts, Inc. Recommends That Holders of Operating Partnership Units of Host Hotels & Resorts, L.P. Reject “...
August 17 2017 - 4:15PM
Host Hotels & Resorts, Inc. (NYSE:HST) (the “Company”) has
learned that certain affiliates of MacKenzie Capital Management, LP
(“Purchaser”) made an unsolicited “mini tender” offer for up to
240,000 operating partnership units (“OP Units”) of Host Hotels
& Resorts, L.P. (“Host L.P.”) at a price of $15.15 per OP Unit
less cash distributions made by Host L.P. after July 31, 2017 (the
“MacKenzie Offer”). This follows several earlier “mini
tender” offers by the Purchaser launched in 2016 and 2017.
Neither the Company nor Host L.P. are in any way associated with
the MacKenzie Offer, and holders of OP Units are under no
obligation to take any action with respect to the MacKenzie Offer.
Mini-tender offers seek less than 5 percent of a
company’s outstanding equity. This allows the offering company to
avoid many of the United States Securities and Exchange Commission
(the “SEC”) disclosure and procedural requirements for tender
offers. The SEC’s guidance to investors on “mini tender”
offers is available at www.sec.gov/investor/pubs/minitend.htm. This
guidance advises that mini-tender offers “have been increasingly
used to catch investors off guard” and that investors “may end up
selling their securities at below-market prices.”
After careful evaluation of the MacKenzie Offer,
the Company and Host L.P. recommend that the holders of OP Units
reject this unsolicited offer. In making this recommendation, the
Company primarily considered that the offer price in the MacKenzie
Offer is below the $17.95 per share closing stock price of the
Company’s common stock on August 15, 2017. Although there is
no trading market for the OP Units themselves, at any time holders
of OP Units may request that the Company redeem their OP Units and
the Company, in its discretion, may either redeem the OP Units for
cash or, in the alternative, issue 1.021494 shares of the Company’s
common stock in exchange for each OP Unit, which shares may then be
sold. Based on the closing price of the Company’s common
stock on August 15, 2017 of $17.95, an OP Unitholder would receive
shares with a market value of approximately $18.34 compared to the
cash MacKenzie Offer of $15.15.
The Purchaser has made many similar unsolicited
mini-tender offers for equity of other companies and four earlier
unsolicited mini-tender offers to holders of Host L.P. units at a
similar discount to current market value. Like its other offers,
this offer puts individual investors at risk because they may not
realize they are selling their OP Units at a discount. The Company
urges investors to get current quotes for the Company’s common
stock for which their OP Units may be redeemed, consult their
financial advisors and exercise caution with respect to the
MacKenzie Offer. The Company recommends that OP Unitholders who
have not responded to the Purchaser’s offer take no action. The
Company encourages brokers and dealers, as well as other market
participants, to review the SEC’s letter regarding broker-dealer
mini-tender offer dissemination and disclosure at:
http://www.sec.gov/divisions/marketreg/minitenders/sia072401.htm.
Holders of OP Units should consult with their
personal financial advisor or other legal, tax or investment
professional(s) regarding any questions they may have.
The Company requests that a copy of this press
release be included with all distributions of materials related to
the MacKenzie Offer.
About Host Hotels &
Resorts
Host Hotels & Resorts, Inc. is an
S&P 500 and Fortune 500 company and is the largest lodging real
estate investment trust and one of the largest owners of luxury and
upper-upscale hotels. The Company currently owns 89 properties
in the United States and 6 properties internationally totaling
approximately 53,000 rooms. The Company also holds non-controlling
interests in seven joint ventures, including one in Europe that
owns 10 hotels with approximately 3,900 rooms. Guided by a
disciplined approach to capital allocation and aggressive asset
management, the Company partners with premium brands such as
Marriott®, Ritz-Carlton®, Westin®, Sheraton®, W®, St. Regis®, Le
Meridien®, The Luxury Collection®, Hyatt®, Fairmont®, Hilton®,
Swissôtel®, ibis®, Pullman®, and Novotel® as well as independent
brands in the operation of properties in over 50 major markets
worldwide. For additional information, please visit the Company's
website at www.hosthotels.com.
* This press
release contains registered trademarks that are the exclusive
property of their respective owners. None of the owners of these
trademarks has any responsibility or liability for any information
contained in this press release.
Gregory J. Larson
Executive Vice President
240.744.5120
Bret D.S. McLeod
Senior Vice President
240.744.5216
Gee Lingberg
Vice President
240.744.5275
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