Latest news release from CHIP (HOT.UN on the TSE). Their new web site is the link at the end of the article. Royal Host's offer is so far off the mark that it has annoyed CHIP shareholders.
<snip>
newswire.ca
-
CHIP REIT unitholders to receive updated and corrected Royal Host information
VANCOUVER, June 11 /CNW/ - Canadian Hotel Income Properties
Real Estate Investment Trust
HOT.un
Canadian Hotel Income Properties Real Estate Investment Trust (''CHIP
REIT'') has been informed that Royal Host REIT intends to provide a ''revised
forecast'' and ''corrected information'' regarding their takeover offer for
all of the units of CHIP REIT. This follows CHIP REIT's submission to various
securities commissions that the offer contained outdated, incorrect and
misleading information.
''We are pleased that CHIP REIT unitholders will be provided with
corrected and up-to-date information about Royal Host, but are concerned that
this information is being made available only 10 days before the current
expiry date of the offer,'' said Rhys Eyton, Chairman, President and CEO of
CHIP REIT.
CHIP REIT's Board of Trustees and their financial advisors have
recommended that unitholders not tender their units to this offer for a number
of reasons including:
- The offer provides no discernible value, with a negligible premium
(2.4%) to CHIP REIT's pre-announcement trading price and no material
increase in recurring distributable cash to CHIP REIT unitholders.
- Combining with Royal Host would weaken the balance sheet, raise the
cost of debt and reduce access to capital.
- Combining with Royal Host would weaken CHIP REIT's hotel portfolio,
dramatically increasing exposure to the less attractive
limited-service hotel segment, which is more susceptible to new
competition.
CHIP REIT was Canada's first hotel real estate investment trust and has a
focus on mid-market and upscale full-service hotels. Through upgrades,
repositioning and franchising, CHIP REIT and its wholly owned hotel manager,
CHIP Hospitality, improve the operating performance of the properties within
the portfolio to create value for investors. CHIP REIT currently owns and
operates 36 hotels with close to 8,000 rooms across Canada. CHIP REIT units
trade on The Toronto Stock Exchange under the symbol HOT.un.
%SEDAR: 00005031E
-30-
For further information: Kevin Grayston, Executive Vice President &
Chief Financial Officer, (604) 685-0011, Fax (604) 685-0019, Website:
chipreit.com |
