Merger Expected to Close During Third Quarter
Apple Hospitality REIT Inc. (NYSE:APLE) has agreed to acquire Apple REIT Ten Inc. for $1.3 billion in a merger creating one of the largest select-service hospitality REITs with a combined 234 hotels and 30,017 rooms across 33 states.
Apple Hospitality REIT, with an enterprise value of $5.7 billion will keep its name in the transaction comprised of $94 million in cash, with about 49.1 million Apple Hospitality common shares issued to Apple Ten shareholders, and the larger REIT assuming about $239 million in debt.
Apple Ten REIT will have a 45-day window to solicit alternative proposals from third parties, however, the termination fee is $5 million if the company, a non-traded REIT managed by the same team managing the publicly traded Apple Hospitality REIT, withdraws from the transaction. After the 45 days ending on May 28, the breakup charge rises to an even steeper $25 million.
