Skift Take
Extended Stay America's significant hotel ownership, an industry anomaly these days, drove it to sell, or at least that was the C-suite argument. Buildings are getting old and need a lot of money to renovate. Major shareholders aren't buying that argument.
Blackstone and Starwood Capital’s earlier respective bids for Extended Stay America are the latest examples of why shareholders — and even two board members — aren’t satisfied with the $6 billion joint acquisition’s price tag.
While Blackstone and Starwood are acquiring Extended Stay America as partners, the companies have been independently interested in a deal as far back as 2017, according to a filing this week with the U.S. Securities and Exchange Commission. Multiple earlier bids would have eclipsed the pair’s current $6 billion, or $19.50, per share deal.
News of the higher bids is the latest revelation following weeks of major shareholders voicing opposition to the current bid, as they felt it was too low.
“We are dismayed that the board would approve such an obviously inadequate price and shocked that the board did so over the objection of two of its own members," said a spokesperson for Tarsadia Capital, a family wealth fund that has a nearly 4 percent stake in Extended Stay America.
The SEC filing
