Ashford Hospitality Trust is bidding $1.27 billion for FelCor Lodging Trust, which owns the Knickerbocker and Royalton hotels in New York.
The Wall Street Journal first reported in early January that FelCor is exploring a sale. Texas-based Ashford already owns 4.5 percent of FelCor’s common shares, according to Reuters.
The offering price is 28.2 percent above FelCor’s market value as of Friday. Ashford claims that a merger between the two REITs would create the second-largest public hotel REIT by room count.
FelCor, also based in Texas, bought the Knickerbocker Hotel for $109 million in 2011 and spent $240 million renovating it. Also in 2011, the company agreed to buy the Morgans and Royalton hotels for $140 million. [Reuters] — Konrad Putzier