FelCor Responds to Land and Buildings and Provides Strategic Update
28 Janeiro 2016 - 7:15PM
Business Wire
FelCor Lodging Trust Incorporated (NYSE:FCH) today responded to
an investor presentation announced by investment fund Land and
Buildings and provided an update on the execution of its strategic
plan.
“We welcome constructive input from shareholders and appreciate
what Land and Buildings has put forward. In fact, we began
implementing virtually the same plan last fall. We have sold 40
assets since 2010, raising proceeds of close to $1 billion, and are
already in the process of selling Morgans, Royalton and some or all
of the Knickerbocker, as well as two other hotels, and using the
proceeds to reduce debt and repurchase shares under our previously
announced $100 million stock buyback program. We also have begun
de-staggering our board. FelCor’s Board and management are
committed to acting in the best interests of all stockholders and
to maximizing value creation. We will continue to engage with our
stockholders as we execute our previously announced long-term
strategic plan.”
Strategic Plan Update
In 2015, FelCor announced the next phase of its long-term
strategic plan. Since then, the company has focused on
opportunistically selling five hotels and using the proceeds to
repay debt, to repurchase common stock and to take advantage of
future value-creation opportunities. Since that time, the company
has made significant progress, including:
- Commenced marketing five hotels,
including three New York properties - Morgans, Royalton and The
Knickerbocker (in whole or part).
- Received letters of intent for two
hotels (Morgans and Royalton) and agreed to sell a third (Holiday
Inn Nashville Airport), at compelling valuations. The company is
currently in preliminary discussions with potential buyers for the
remaining two properties.
- Implemented a $100 million stock
repurchase program, which commenced in December. So far, FelCor has
purchased 4.3 million shares for $29.0 million. The company intends
to continue repurchasing its common stock, which trades at a
significant discount to NAV, and may increase its stock repurchase
authorization after selling the five hotels.
FelCor has transformed its business to create long-term value
for stockholders. During 2015, RevPAR increased 8.1%, significantly
higher than the industry. Since 2008, FelCor’s RevPAR growth has
exceeded the industry and its peers. This next phase of FelCor’s
strategic plan will continue providing significant incremental
value.
FelCor is committed to creating a strong balance sheet with a
low cost of capital. Following completion of the asset sales:
- Leverage will be below 4 times (based
on 2016 estimates), reduced from 8.2 times in 2010.
- FelCor has the best debt maturity
profile of any hotel REIT, with no major debt maturities until
2022.
- FelCor will have significantly enhanced
liquidity to deliver even more stockholder value, with more than
$700 million available, including its entire $400 million line of
credit.
About FelCor
FelCor, a real estate investment trust, owns a diversified
portfolio of primarily upper-upscale and luxury hotels that are
located in major urban and resort markets throughout the U.S.
FelCor partners with top hotel companies that operate its
properties under globally renowned names and as premier independent
hotels. Additional information can be found on the company's
website at www.felcor.com.
Forward Looking Statements
This press release includes “forward-looking statements” within
the meaning of the federal securities laws. Numerous risks and
uncertainties and other factors may cause actual results to differ
materially from those anticipated at the time the forward-looking
statements are made. Certain of these risks and uncertainties are
described under “Risk Factors” in our Annual Report on Form 10-K or
in our other filings with the Securities and Exchange Commission.
We undertake no obligation to update any forward-looking statement
to conform the statement to actual results or changes in our
expectations.
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version on businesswire.com: http://www.businesswire.com/news/home/20160128006486/en/
FelCorStephen A. Schafer, 972-444-4912Senior Vice
Presidentsschafer@felcor.comorSard Verbinnen & Co.Hugh
Burns/Emily Deissler,
212-687-8080hburns@sardverb.comedeissler@sardverb.com
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