The boards of directors of Apple Hospitality REIT, Inc. and Apple REIT Ten, Inc. have announced the approval of a merger agreement under which the companies will create a select service lodging REIT. The merger will form a portfolio of 234 hotels with 30,017 guestrooms geographically diversified across 94 MSAs throughout 33 states. The newly created REIT will have an enterprise value of approximately $5.7 billion and a total equity market capitalization of approximately $4.4 billion, based on the 20 Day VWAP (volume weighted average price) of Apple Hospitality’s common shares ending April 12, 2016. The terms of the merger include $94 million in cash, approximately 49.1 million Apple Hospitality common shares issued to Apple Ten shareholders and the assumption of approximately $239 million in debt. At closing, Apple Hospitality shareholders are expected to own 78 percent of the new REIT, while Apple Ten shareholders would take the remaining 22 percent.
