ICAMAP Investments SÀRL and Ivanhoé Cambridge Inc.'s Cadim Fonds Inc. unit offered to acquire the ordinary shares of easyHotel PLC not already owned by ICAMAP at 95 pence apiece in cash, implying an enterprise value of £126.1 million.
The consortium made the offer through Citrus UK Bidco Ltd., a newly incorporated company. The cash offer reflects a 34.8% premium to easyHotel's closing share price of 70.5 pence on Aug. 2.
ICAMAP is the largest shareholder of easyHotel, owning 38.65% of its shares. The real estate fund manager and Ivanhoé believe the current structure of easyHotel's shareholder base is not suited to attract new capital to finance its long-term investment program.
The deal will be implemented by way of a takeover, although the bidder has the right to switch to a scheme of arrangement. EasyHotel's directors unanimously recommended that the company's shareholders vote in favor of the transaction. The consortium set the offer acceptance condition at only 50%.
The cash consideration for the offer will be funded with a combination of equity contributions from Ivanhoe and the ICAMAP fund. If the offer is declared unconditional and Bidco acquires 75% of easyHotel's shares, the European budget hotel operator will be delisted from the London Stock Exchange's Alternative Investment Market.
Bidco will not make any changes to easyHotel's existing workforce but the company's nonexecutive directors, except Harm Meijer, are expected to resign upon deal closing.
EasyHotel will continue to operate independently and will keep its headquarters. It will also continue to pursue its development pipeline, while Bidco reviews the existing financing arrangements.
Lazard & Co. Ltd. is the financial adviser to Bidco, while Tulchan Group is its public relations adviser. Investec Bank PLC is the financial adviser, nomad and broker to easyHotel, while Houston PR is its public relations adviser.
Allen & Overy LLP is the legal adviser to ICAMAP and Bidco. Cleary Gottlieb Steen & Hamilton LLP is the legal adviser to Ivanhoé, while Stephenson Harwood LLP is the legal adviser to easyHotel.