Strategic rebuffs shareholder’s request for company sale

Strategic Hotels & Resorts announced on Tuesday that it disagreed with the public push by one of its shareholders to sell the company.

The board of directors of Strategic Hotels & Resorts, Chicago, said that it “strongly disagrees” with the assertions of Orange Capital, which owns 6.25 million shares of Strategic common stock, that the sale of Strategic’s properties would likely result in proceeds of US$11 to US$14 per share, a 40% to 79% premium. Strategic’s board also criticized Orange for making this public.

“While we are disappointed Orange Capital released its letter publicly to advance its short-term trading interest, we remain focused on maximizing the longer-term interests of our shareholders,” Strategic stated in a press release.

Since the departure of longtime CEO Laurence Geller in November 2012, financial analysts have been speculating that Strategic could be a takeover target by REITs such as Host Hotels & Resorts. However shortly after Geller left, Strategic amended its existing shareholder rights plan to extend the expiration date for an additional 12 months to protect the company from unwanted takeover attempts.

Strategic noted that Orange Capital, New York City, has not given a buyout offer.