TKO lodges $2 billion bid for Service Properties Trust’s hotel portfolio

US: Hospitality investment firm TKO has submitted a formal written offer to acquire the entire hospitality portfolio of Service Properties Trust (SVC) for $2 billion in cash.

The portfolio consists of 93 hotels with 21,110 rooms/suites. It includes properties operating under the Sonesta (including Royal Sonesta, Sonesta Hotels & Resorts, Sonesta ES Suites, Sonesta Select, and Sonesta Simply Suites), Hyatt Place, Radisson, and Crowne Plaza brands.

The all-cash transaction, subject to execution of definitive documentation and customary closing conditions, would provide SVC with immediate liquidity to support meaningful debt reduction while enabling the company to focus on its substantial and highly attractive net lease retail platform.

TKO says it believes this offer “delivers compelling value to SVC shareholders by crystallising the hotel portfolio’s worth at a significant premium to its implied market valuation while eliminating the operational complexity and capital intensity inherent in hospitality assets”.

George Sell