TRT Holdings, owners of the Omni Hotels brand and Gaylord Entertainment’s largest shareholder, said in a letter to shareholders that it opposes the US$210 million sale of the Gaylord brand to Marriott International.
“We believe that Gaylord and its stockholders are better off maintaining the status quo,” said James Caldwell, TRT’s president, in the letter.
The deal would give Marriott the Gaylord name and management rights to the company’s hotels. Gaylord would continue to own the properties, and would convert to a real estate investment trust.
TRT Holdings, which owns a 21.8% stake in Gaylord, said in its letter that the deal is biased in favor of Marriott and that shareholders would suffer as the value and marketability of the properties would be significantly impaired by the agreement.
Going into further detail, TRT said the deal as currently constituted would prohibit Gaylord from selling any of the four hotels without Marriott’s consent and severely limit Gaylord’s ability to terminate Marriott’s management deal, which could last up to 65 years.
Gaylord in May said its conversion to a REIT would reduce the company’s tax burden and give its investors higher returns.
The Tennessean reported on Wednesday that Gaylord expects to hold a shareholders vote in August, with Marriott taking management in October, and REIT status commencing in January.