TKO Offers $2 Billion to Buy 92 US Hotels
TKO submitted an unsolicited $2 billion offer to acquire 92 hotels from Service Properties Trust comprising approximately 21,000 rooms, sending the latter's stock surging 14.95%.
TKO submitted an unsolicited offer to acquire 92 hotels containing approximately 21,000 rooms from Service Properties Trust for $2 billion in cash, or about $95,000 per room, according to Skift.
The offer excludes 745 net-lease commercial properties owned by the target company.
TKO currently owns 58 properties with slightly over 4,000 rooms and has not disclosed how the transaction will be financed.
Shares of Service Properties Trust jumped 14.95% following the news, after falling more than 50% over the past year. The company confirmed receiving the offer on October 9, and no agreement has been signed to date.
What Do These Terms Mean?
Unsolicited offer: A buyout offer initiated by a buyer on their own without prior request or negotiation from the target company.
Net lease: An arrangement where the tenant pays rent plus operating costs, taxes, and insurance, providing the owner with net rent.
Price per room: The value paid for each hotel room in a deal, used to compare hotel transactions with one another.
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