Diamond Resorts
acquires Sunterra
PHILIPSBURG/LAS VEGAS--Diamond Resorts announced that it had entered into a definitive agreement under which one of its affiliates would acquire Sunterra Corporation, which operates Flamingo Beach Resort and Royal Palm in St. Maarten.
The acquisition is for US $16 per share in cash, a 35 per cent premium over the closing price of Sunterra’s common stock on March 8, the day before rumours of the acquisition entered the marketplace. The total value of the transaction is approximately US $700 million, including US $375 million of existing Sunterra debt.
The Diamond Resorts affiliate is expected to commence a tender offer for all of Sunterra’s outstanding common stock within the next four business days, which is subject to extension in certain circumstances and will remain open for 40 calendar days following commencement of the offer. A bank group led by Credit Suisse has provided a debt financing commitment to Diamond Resorts to support the offer.
Diamond Resorts Chairman and Chief Executive Officer Stephen J. Cloobeck said, “We are very excited about this acquisition, which will enable Diamond Resorts to build on our position as a world leader in the vacation ownership industry to create the largest pure-play vacation ownership company in the world.
“With more than 25 years of experience and a successful track record in the development, management, marketing and sales of vacation ownership properties, we are uniquely positioned to capitalise on Sunterra’s assets and enhance its position as a global leader in vacation ownership innovation and quality.”
Diamond Resorts intends to invest in Sunterra’s worldwide platform, including its 96 branded or affiliated vacation ownership resorts throughout the continental United States as well as in Hawaii, Canada, Europe, the Caribbean and Mexico.
Cloobeck added, “Our goal is to acquaint more consumers with the many benefits of vacation ownership and deliver an enhanced hospitality experience to Sunterra’s 326,000 current owner families in 13 countries around the globe. We look forward to working with Sunterra’s talented managers and employees to grow the company in the years ahead.”
Sunterra’s Board of Directors has unanimously approved the acquisition and recommends that shareholders accept the offer.
St Maarten vacation rental
