Diamond Resorts International, Inc. (“Diamond Resorts” or the
“Company”) (NYSE: DRII) today announced that it has entered into an
Agreement and Plan of Merger (the “Merger Agreement”) with
affiliates of certain funds (the “Apollo Funds”) managed by
affiliates of Apollo Global Management, LLC (together with its
consolidated subsidiaries, “Apollo”) (NYSE: APO), pursuant to which
the Apollo Funds will acquire Diamond Resorts for $30.25 per share
or approximately $2.2 billion.
The all-cash offer represents a premium of approximately 26%
over Diamond Resorts’ closing share price on June 28, 2016, and a
premium of approximately 58% over the closing share price on
February 24, 2016, the day of Diamond Resorts’ announcement that it
was exploring strategic alternatives.
Mr. David Palmer, Chief Executive Officer of Diamond Resorts,
said, “We 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 our
shareholders. Apollo values the culture of hospitality and customer
service that is the legacy of our Founder and Chairman Stephen J.
Cloobeck and instilled in our organization. We are confident that
Diamond Resorts will continue to be a vibrant company for our
employees, partners and customers, and I am excited about the
future of Diamond Resorts.”
The transaction will be completed through an all-cash tender
offer. The Company’s Board of Directors, acting upon the
recommendation of its Strategic Review Committee (the “Strategic
Review Committee”), approved and adopted the Merger Agreement and
recommends that the Company’s shareholders tender their shares in
the offer pursuant to the Merger Agreement.
“We are tremendously excited about the opportunity for our funds
to acquire Diamond Resorts,” said David Sambur, Partner at Apollo.
“Stephen, David, 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 transaction is conditioned upon satisfaction of the minimum
tender condition which requires that shares representing more than
50 percent of the Company’s common shares be tendered and the
receipt of certain regulatory approvals and other customary closing
conditions.
There is no financing condition to completion of the tender
offer and the merger. Financing is being provided by Barclays,
Royal Bank of Canada, and Jefferies. PSP Investments Credit USA LLC
is also providing debt financing commitments.
The transaction is currently expected to close over the next few
months. If completed, the transaction will result in the Company
becoming a privately held company, and Diamond Resorts’ common
shares will no longer be listed on any public market.
Centerview Partners is serving as exclusive financial advisor to
the Strategic Review Committee. Gibson, Dunn & Crutcher LLP is
serving as legal advisor to the Strategic Review Committee. DLA
Piper LLP served as special counsel and Katten Muchin Rosenman LLP
served as antitrust counsel to the Company. Barclays and RBC
Capital Markets, LLC are acting as M&A advisors to Apollo and
Paul, Weiss, Rifkind, Wharton & Garrison LLP is acting as legal
advisor to Apollo.
About Apollo
Apollo is a leading global alternative investment manager with
offices in New York, Los Angeles, Houston, Chicago,
Bethesda,
Toronto, London, Frankfurt, Madrid, Luxembourg,
Mumbai, Delhi, Singapore, Hong
Kong and Shanghai. Apollo had assets under management of
approximately $173 billion as of March 31, 2016 in private equity,
credit and real estate funds invested across a core group of nine
industries where Apollo has considerable knowledge and
resources. For more information about Apollo,
visit www.agm.com.
About Diamond Resorts International
Diamond Resorts International (NYSE: DRII), with its network of
more than 420 vacation destinations located in 35 countries
throughout the continental United States, Hawaii, Canada, Mexico,
the Caribbean, South America, Central America, Europe, Asia,
Australasia and Africa, provides guests with choice and flexibility
to let them create their dream vacation, whether they are traveling
an hour away or around the world. Our relaxing vacations have the
power to give guests an increased sense of happiness and
satisfaction in their lives, while feeling healthier and more
fulfilled in their relationships, by enjoying memorable and
meaningful experiences that let them Stay Vacationed.
Safe Harbor Statement
This press release contains forward-looking statements,
including statements related to proposed transaction and other
statements regarding the Company’s current expectations, prospects
and opportunities. These forward-looking statements are covered by
the “Safe Harbor for Forward-Looking Statements” provided by the
Private Securities Litigation Reform Act of 1995. The Company has
tried to identify these forward looking statements by using words
such as “expect,” “anticipate,” “estimate,” “plan,” “will,”
“would,” “should,” “could,” “forecast,” “believe,” “guidance,”
“projection,” “target” or similar expressions, but these words are
not the exclusive means for identifying such statements. The
Company cautions that a number of risks, uncertainties and other
factors could cause the Company’s actual results to differ
materially from those expressed in, or implied by, the
forward-looking statements, including, without limitation that the
conditions to closing the transaction will be satisfied; the impact
of the transaction on the Company’s business, its financial and
operating results and its employees, suppliers and customers (in
particular, HOAs and prospective purchasers of vacation ownership
interests); factors affecting the feasibility and timing of any
transaction or other action, including, without limitation,
required third-party consents and regulatory approvals; the ability
to identify and close any transaction; and risks related to
realization of the expected benefits of the transaction or other
action to the Company and its stockholders. For a detailed
discussion of factors that could affect the Company’s future
operating results, please see the Company’s filings with the
Securities and Exchange Commission, including the disclosures under
“Risk Factors” in those filings. Except as expressly required by
the federal securities laws, the Company undertakes no obligation
to update or revise any forward-looking statements, whether as a
result of new information, changed circumstances or future events
or for any other reason.
Additional Information and Where to
Find It
The tender offer for the outstanding shares of Diamond Resorts
referenced in this press release has not yet commenced. This
communication is for informational purposes only and is neither an
offer to purchase nor a solicitation of an offer to sell shares,
nor is it a substitute for the tender offer materials that the
Apollo Funds’ acquisition subsidiary will file with the U.S.
Securities and Exchange Commission (the “SEC”) upon
commencement of the tender offer. At the time the tender offer is
commenced, the Apollo Funds’ acquisition subsidiary will file
tender offer materials on Schedule TO, and Diamond Resorts
thereafter will file a Solicitation/Recommendation Statement on
Schedule 14D-9 with the SEC with respect to the tender
offer. THE TENDER OFFER MATERIALS (INCLUDING AN OFFER TO PURCHASE,
A RELATED LETTER OF TRANSMITTAL AND CERTAIN OTHER TENDER OFFER
DOCUMENTS) AND THE SOLICITATION/RECOMMENDATION STATEMENT WILL
CONTAIN IMPORTANT INFORMATION. HOLDERS OF SHARES OF THE DIAMOND
RESORTS ARE URGED TO READ THESE DOCUMENTS CAREFULLY WHEN THEY
BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION
THAT HOLDERS OF THE DIAMOND RESORTS SECURITIES SHOULD CONSIDER
BEFORE MAKING ANY DECISION REGARDING TENDERING THEIR
SECURITIES.
The Offer to Purchase, the related Letter of Transmittal and
certain other tender offer documents, as well as the
Solicitation/Recommendation Statement, will be made available to
all holders of shares of Diamond Resorts at no expense to them. The
tender offer materials, the Solicitation/Recommendation Statement
and other related documents (when available) will be made available
for free at the SEC’s web site at www.sec.gov.
Investors and securityholders may access copies of the
Solicitation/Recommendation Statement and other related documents
(when available) that Diamond Resorts files with the SEC
at investors.diamondresorts.com.
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version on businesswire.com: http://www.businesswire.com/news/home/20160629005748/en/
Investors:Sloane & CompanyErica Bartsch,
1-212-446-1875ebartsch@sloanepr.comorApollo Global Management,
LLCGary Stein, 1-212-822-0467gstein@apollolp.comorMedia:Diamond
Resorts International, Inc.Stevi Wara,
1-702-823-7069Media@DiamondResorts.comorRubenstein Associates, Inc.
for Apollo Global Management, LLCCharles Zehren,
1-212-843-8590czehren@rubenstein.com
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