TORONTO, (Reuters) – Four Seasons Hotels Inc. said on Monday it has agreed to a $3.37 billion offer to be taken private by a group that includes the Canadian company’s chief executive as well as Saudi Prince Alwaleed bin Talal and Microsoft Corp. Chairman Bill Gates.
Four Seasons said the transaction was approved unanimously by its board following a report and recommendation by a panel of independent directors.
A shareholders meeting to vote on the deal is expected in April, the company said. The transaction will require approval by two-thirds of the votes cast by holders of limited voting shares.
Last November, Prince Alwaleed’s Kingdom Hotels International and Gates’ Cascade Investment LLC. offered $82 in cash for each limited voting share, a bid that values Four Seasons at $3.8 billion including debt, the company said.
The equity portion of the deal is valued at $3.37 billion, based on 41.1 million outstanding limited and variable multiple voting shares, although Prince Alwaleed already has a 23-percent stake in Four Seasons, while Cascade has 8.2-percent of the company.
“Given the recent trading activity, we believe some investors may be disappointed, however we believe this offer is good value,” UBS analyst William Truelove said in a research note.
Shares of Four Seasons were down $2.60, or 3.1 percent, at $81.28 in New York on Monday, and down C$2.75, or 2.8 percent, at C$95.48 on the Toronto Stock Exchange.
The stock traded as high as $84.25 in New York on Friday.
This is the Saudi billionaire’s second foray into the Canadian hotel segment since 2005. In January 2006, his Kingdom Hotels joined forces with a U.S investment group to buy another luxury chain, Fairmont Hotels & Resorts, for $3.9 billion.
If the deal goes through, founder, chairman and chief executive Isadore Sharp and his family holding company, Triples Holdings Ltd., will have a 10-percent stake of the hotel chain, with the remaining shares split equally between Kingdom and Cascade.
Sharp will also gain $288 million from the deal.