A battle is brewing between Gaylord Entertainment and its largest shareholder over the pending $210 million sale of the management rights for four hotels to Bethesda, Md.-based Marriott International.
Irving, Texas-based TRT Holdings, which owns Omni Hotels and holds a 22 percent stake in Gaylord, sent a letter to shareholders last week urging them to vote against the Marriott deal and Gaylord’s plan to convert into a real estate investment trust, according to a regulatory filing.
As an REIT, Gaylord would retain ownership of the Gaylord National Resort and Convention Center that anchors National Harbor in Oxon Hill, Md. It would also own Gaylord Opryland in Nashville, Tenn., Gaylord Palms in Kissimmee, Fla., and Gaylord Texan in Grapevine, Texas.
Gaylord had planned to build an $824 million hotel and conference center in Aurora. But after the Marrriott deal, the company said it would seek an outside developer to complete a scaled-down version of the project.
“The proposed transaction does not appear to be in the best long-term interests of Gaylord and its stockholders,” TRT said in a letter to shareholders. “The agreement is biased in favor of Marriott and appears to have been poorly negotiated by Gaylord.”
The shareholder letter went on to say the “value and marketability of the Gaylord properties will be significantly impaired” by the deal because of its “onerous restrictions” on terminating the contract or selling the hotels.
Gaylord issued a statement refuting TRT’s charges. The Nashville-based company said there are no restrictions on selling the properties, and access to Marriott’s extensive services and economies of scale will up the value of the properties.
Developing, operating and owning hotels helped Gaylord command as much as $57 a share in 2007, but once the economy weakened the stock tumbled to $6 a share in 2009. Around that time, TRT bought 13 percent of Gaylord, upping that stake in the ensuing years.
Reed, who was unavailable for further comment, was worried that TRT was trying to gain control of Gaylord.
