VANCOUVER, British Columbia, Jan. 06, 2020 (GLOBE NEWSWIRE) -- Allied Hotel Properties Inc. (“Allied” or the “Company”) (TSX-V: AHP), announced that it has completed the sale of all or substantially all of the assets of the Company to DVP Hotel Development LP for $102 million (subject to adjustments), as previously announced on October 23, 2019 and as approved by the Company’s shareholders at a special meeting held on December 19, 2019. The assets sold include the business and related hotel property known as “Toronto Don Valley Hotel and Suites”, located at 175 Wynford Drive, Toronto, Ontario, the adjacent development lands and certain other assets related to the operation of the hotel (the “Transaction”).
The net cash proceeds of the Transaction, after the effect of the transaction costs, closing adjustments and taxes arising from the Transaction, is estimated to be approximately $78 million. The Company has also reserved an amount of $4.5 million for purposes of a holdback and net equity maintenance arising from the Transaction. As a result of the aforementioned, the Company expects to have approximately $73.5 million cash reserves on hand (the “Total Cash Reserves”) following completion of the Transaction.
Management and the board of directors (the “Board”) of the Company have yet to fully consider how the Company will use the Total Cash Reserves, and may utilize those funds in any manner that the Board determines appropriate. However, the Company currently anticipates returning substantial portions of the Total Cash Reserves to shareholders by way of a dividend in due course, to be paid in one or more installments, as determined by the Board, at its sole discretion.
About Allied Hotel Properties Inc.
Allied is involved in the ownership, management and development of hotels and real estate in Canada, having a history of real estate development particularly where such development can be undertaken on hotel lands. Interested parties can find further information at www.alliedhotels.com.
On behalf of the Board of Directors:
(signed) Michael F. Chan
Michael F. Chan
President, Chief Financial Officer, Secretary and Director
For more information please contact:
Allied Hotel Properties Inc.
Tel: 604-669-5335
Fax: 604-682-8131
e-mail: mikechan@alliedhotels.com
Neither the TSX Venture Exchange nor its regulation services provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward-Looking Information
Certain statements contained in this press release constitute forward-looking information within the meaning of applicable securities laws. These statements relate to future events or future performance. The use of any of the words “anticipate”, “estimate”, “will” and “expect” and similar expressions and statements are intended to identify forward-looking information and are based on Allied’s current beliefs or assumptions as to the outcome of such future events. Actual future results may differ materially. In particular, this press release contains forward-looking information concerning: use of the Total Cash Reserves. Various assumptions or factors are typically applied in drawing conclusions or making the forecasts or projections set out in forward-looking information. Those assumptions and factors are based on information currently available to the Company. The material facts and assumptions include, but are not limited to: the Board determining when and how the Total Cash Reserves will be returned to shareholders.
Many factors, both known and unknown, could cause actual results to be materially different from the results that are or may be expressed or implied by such forward-looking information contained in this press release. Such factors include, without limitation, the following risks: the return of Total Cash Reserves to shareholders will not occur immediately. The Company cautions the reader that the above list of risk factors is not exhaustive.
The forward-looking information contained in this press release is made as of the date hereof and the Company is not obligated to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. Due to the risks, uncertainties and assumptions contained herein, investors should not place undue reliance on forward-looking information. The foregoing statements expressly qualify any forward-looking information contained herein.