Ashford Trust to spin-off asset management business as separate, publicly traded platform
Ashford Hospitality Trust is planning to spin-off its asset management business into a separate publicly traded company in the form of a taxable distribution.
The distribution is expected to be completed in the third quarter of 2014 and will be comprised of common stock in Ashford, Inc, a newly formed or successor company of the Company's existing advisor subsidiary, Ashford Hospitality Advisors LLC, which currently advises Ashford Hospitality Prime. The Company plans to file a listing application for Ashford Inc with the NYSE or NYSE MKT Exchanges. In connection with the spin-off, it is anticipated that Ashford Inc will enter into a 20-year advisory agreement to externally advise the Company. In addition, Ashford Inc will continue to externally advise Ashford Prime.
It is expected that Ashford Inc will be well positioned to grow its asset management business. The Company's investment securities subsidiary is raising capital and it is expected that Ashford Inc will advise this platform. In addition, other business opportunities for Ashford Inc include future external advisory services to other platforms, such as a select service hotel platform and a hotel debt platform, both of which are opportunities being explored by the Company. Further, it is anticipated that Ashford Inc will pursue other business acquisitions which may include hotel management, project and construction management, and other hospitality related services.
This distribution is anticipated to be declared during the third quarter of 2014; however, it remains subject to the filing of the required registration statement with the Securities and Exchange Commission ("SEC"), the review of the registration statement by the SEC, the approval of the listing of shares by the applicable exchange, and other legal requirements. The Company expects to file the required registration statement next month. The Company cannot be certain this distribution will proceed or proceed in the manner as currently anticipated.
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