Pebblebrook Ups Ante for LaSalle Again
New offer represents a 13% premium over the Blackstone deal
Pebblebrook Hotel Trust is still in hot pursuit of real estate investment trust LaSalle Hotel Properties, but the feeling doesn’t seem mutual.
Pebblebrook has enhanced its offer once again to acquire the REIT. Under the new terms, Pebblebrook increased the number of LaSalle common shares that can receive $37.80 in cash per share to up to 30% of common shares in aggregate. That represents a 50% increase in the number of shares that can receive cash compared to Pebblebrook’s prior offer. That previous offer, announced last month, had valued LaSalle at $36.21 per share. Additionally, shareholders have options with this new offer. For each common share of LaSalle that they own, shareholders can either receive a fixed amount of $37.80 in cash or a fixed exchange ratio of 0.92 Pebblebrook common share.
LaSalle has acknowledged receipt of Pebblebrook’s bid and has advised shareholders to take no action at present, saying in a news release that the board will respond in “due course” and that the board has not “changed its recommendation of the existing transaction with Blackstone.” On May 21, LaSalle entered into a definitive agreement with affiliates of Blackstone Real Estate Partners VIII, under which Blackstone will acquire all outstanding common shares of beneficial interest of LaSalle for $33.50 per share in an all-cash transaction valued at $4.8 billion. The new Pebblebrook cash offer represents a 13% premium over the Blackstone deal. The Pebblebrook proposal also takes into account the $112 million termination fee LaSalle agreed to pay to Blackstone.
As of market close on Wednesday, LaSalle was valued at $34.88 per share, according to Bloomberg.