3DH

...according to Sherpa Report, 20.

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"Boutique" is better! Another extremely satisfied LUSSO member!

Sherpa

They had 18 full memberships, but a couple of them were shared.


In answer to the question at the start of this thread the answer in the latest announcement from UR is Q2.

Cheers

__________________
Sherpa
www.SherpaReport.com

LTTravel

That is a good addition then. If all 18 members joined UR, they got 6 homes for 18 members, a 3 to 1 ratio.

Steamboat Bill

Does anyone think there is a possibility that the PE-UR merger might NOT happen?

I am not spreading a rumor, I am just curious if there is a possibility that the merger might fall apart.

LTTravel

I was told by someone familiar with it yesterday that they expect the merger to be complete mid-April, which probably means mid-June. It is still very much on.

vineyarder

That is what I have been told as well...

Desties

It's always a possibility. Announced deals fall apart for one of four reasions.

Regulatory approval. It won't play a part here. The DC industry is still too small for the Department of Justice to care that #2 and #3 a re hooking up.

Due diligence. This may have derailed the deal early, but each company has dug into the books already and didn't bolt for the exits.

Shareholder approval. Neither company is public, so no public vote is necessary. Both companies signed off on the deal when it was first announced.

Financing. That's the one thing that could derail this. Both companies have the same creditor apparently, so if the deal doesn't pass the sniff test there it will be hard for any other creditor to save the day.

Obviously the timing is lousy given the stingy lenders.

It makes this even harder because the fate of the destination clubs concept is probably riding on this deal. If the merger fails because of financing, you can expect the cancellation waitlist of PE and UR members to become conga lines. Whether they fear the financial fortitude of their investment or are disappointed to see the promised properties slashed in roughly half, there is no way that either company emerges unscathed if the deal falls through.

That may send a ripple of Tanner & Haley proportions throughout the industry.

Kagehitokiri

i certainly dont care if the merger fails.

vineyarder

I'd add a fifth possible reason; incompatible corporate cultures - not always apparent in the early stages of due diligence. I'm not saying that I have any inside information that this is a factor (as I do not), but it is certainly a possibility. I'd agree with Desties however that if the merger fails, lack of financing would be most likely cause.

OTOH, I don't necessarily agree that I, for one, would prefer to see PE grow organically rather than merge with a relatively unknown (to me) entity, so I would not be disappointed to see the merger called off. This is not because I know anything negative about UR, just that I have been very happy with PE and can see much more downside than upside.

LTTravel

I agree with Desties. I think that since this was announced, it is important for it to go through. Though Vineyarder would prefer PE to stay out of UR, I think that there have been at least some (I don't know the numbers) of people who joined UR or PE because of the promise of more destinations, a bigger club and potentially more powerful and financially stable one. I am not saying that that is the actual case, but the perception that people who have joined recently may have had with joining either of the clubs. I don't think that it would be good for UR, PE or the DC industry if this merger does not go through.

Kagehitokiri

let me rephrase. i dont care about the "industry" if the clubs i might join survive. on top of that i disagree with the super wide ranging implications some assign to certain negative news.

also, with regards to UR/PE resignations. how many members joined after announcement, ONLY because of announcement? they certainly cant claim the merger was guaranteed, because both companies have been very clear about "join the club you like" the whole time.

hasnt PE always had top notch satisfaction ratings? that would suggest there might be almost no resignations, even from new members, if merger fails. UR is a different story. i dont know what their satisfaction has been like, or what their financial situation is like. but their financial situation is kind of separate from resignations due to failed merger. also, even if say the club fails financially, its not like T&H because T&H did not own many homes, and basically threw deposit assets away on bad investments.

Desties

It's not a matter of "oh, we're not getting twice as many homes to choose from so I'm out" that will hurt, though it may play a factor.

The real industry killjoy here is the implications of a spooked creditor. If a financing arm looks through the books and deems that it's too big of a risk to bankroll -- even with the realized synergies of a merger -- how confident would you feel about either club's viability without the synergies?

UR and PE are great clubs. You don't grow to become #2 and #3 if your club members aren't satisfied. I just believe that the deal derailing over lack of financing -- instead of easier to swallow derailments -- would be brutal to the health of the industry.

Even if it's not one of your clubs in this deal, there's a good chance that your club will rely on financing to grow in the future if it isn't already. If every feasible lender balks on this merger, where will your club turn?

Kagehitokiri

enter private equity...

i just see these things as (pretty > completely) unrelated to the general market. (depending on entry price / target demographic)

LTTravel

Maybe I'm just ignorant about M/A but why would they need significant financing for such a merger? Aren't they just combining the assets (and of course liabilities of) two companies. This is not a third company trying to acquire two companies by financing the purchase but I see it more as a merger of two companies without the need for significant financing. (So a true merger vs an Acquisition. ) Does a true merger require significant funding? The purpose of this merger would be to decrease competition and expenses with less duplication of services.

Desties

LT, the financing isn't the money required to complete the deal. It is the process of combining the financing that both companies have in place. Since it's a new company, a creditor approaches it in sum. All of PE. All of UR. The good. The bad. The ugly.

Even equity membership clubs that claim to be debt-free like BelleHavens may have some credit line wiggle room (though I don't know for sure).

As for private equity firms saving the day, their access to greenbacks have been equally stifled.

Kagehitokiri

when the luxury market (targets consumers worth more than $10MM) suffers, then ill worry about the future of destination clubs.

TravelGuy

You should start to worry ....

Kagehitokiri

im not worried.

if lusso for some reason doesnt make it, ill just suffer through having to join solstice.