Apollo Global to Buy Diamond Resorts for $2.2 Billion -- 2nd Update
June 29 2016 - 11:09AM
Dow Jones News
By Matt Jarzemsky and Dana Mattioli
Apollo Global Management LLC agreed to buy Diamond Resorts
International Inc. for about $2.2 billion, the timeshare resort
company said Wednesday.
Diamond, based in Las Vegas, announced in February that it was
working with investment bank Centerview Partners on strategic
alternatives. The company has a network of more than 420 vacation
destinations in 35 countries, according to its website.
News of a deal between Apollo and Diamond was first reported by
The Wall Street Journal Wednesday morning.
Apollo will pay $30.25 a share for Diamond, a 26% premium over
Diamond Resorts' closing share price Tuesday. Diamond shares rose
24% to $29.76 in morning trading.
It has been a busy stretch for hospitality mergers and
acquisitions. Earlier this year, Marriott International Inc. agreed
to buy hotel chain Starwood Hotels & Resorts Worldwide Inc. for
$13.6 billion. China's Anbang Insurance Group Co. tried to break up
the deal by making its own offer, costing Marriott $1 billion
extra, but Anbang ultimately walked away. In April, a unit of
China's HNA Group announced a deal to buy Carlson Hotels Inc.,
which owns Radisson and Country Inns & Suites Chains.
Apollo has a history of big bets on hospitality and leisure
companies. The private-equity firm sold Great Wolf Resorts Inc. to
Centerbridge Partners LP last year and holds large stakes in
Norwegian Cruise Line Holdings Ltd. and Caesars Entertainment
Corp., after participating in the 2008 leveraged buyouts of the two
companies and later taking them public. Caesars, like Diamond
Resorts, is based in Las Vegas and a major employer there.
Apollo has been one of the most active private-equity firms this
year. It bought specialty grocer The Fresh Market Inc. for $1.4
billion in April and plans to buy University of Phoenix operator
Apollo Education Group Inc. for $1.14 billion -- big discounts to
the companies' market values a year ago.
The deal is expected to close in the next few months and is
subject to regulatory approvals and customary closing
conditions.
Austen Hufford contributed to this article
Write to Matt Jarzemsky at matthew.jarzemsky@wsj.com and Dana
Mattioli at dana.mattioli@wsj.com
(END) Dow Jones Newswires
June 29, 2016 10:54 ET (14:54 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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