TarheelTraveler

Anyone know what the timeline is now for the UR/PE merger? Seems like it's moving slowly without many timing updates. I'm sure it's a huge undertaking though.

LTTravel

From other posts it seems that PE has had a boost in membership recently. That is partly due to the merger talks. Has this just been a marketing scam?

Kagehitokiri

IMHO it seems like the negotiations might be contentious, and that the membership increases now have some impact on them.

RAM

A lot of factors are probably at play here. From financing (subprime fallout impacting every lender) to property assessments (many of the UR properties are leased, whereas PE is mostly company-owned) to something as simple as negotiating for the UltimateEscapes.com URL (which a simple WHOIS lookup shows that it is still owned by a Brit who registered it four years ago), it was naive for them to announce that the deal would be done by the end of 2007.

Late February was the last I heard, but it wouldn't be a shock to see it go into March.

I'd lay the conspiracy theories to rest. Both companies have been no doubt taking in brisk applications given the pending rate hikes upon merger completion. If the deal falls apart, many of those who have signed on in recent months -- under the assumption that the portfolio of properties would double -- may likely bolt. Neither club wants that kind of liquidity crisis with the cancellation backorder queue filling up.

And if the deal falls apart, it may be just as devastating since at least one, if not both, clubs would be perceived as having financial problems.

I trust that both clubs are keeping their members abreast of the latest merger updates -- either via email to everyone or just by asking on a one-to-one basis -- but it would probably be a good time to send out a new update to the public.

vineyarder

As I understand, based on recent discussions with the CFO, the big hold-up all along has been legal issues related to transfer of titles of the international properties, along with necessary changes to the financing documents on certain domestic as well as international properties, since financing came from several sources. Given the time, energy, and legal costs expended, I am 100% certain that this was not simply a 'marketing ploy'... but I agree that some sort of public update is in order.

TravelGuy

I'm feeling a little vindicated by this. Some of you may remember that I took a lot of heat about this issue on the timeshare forum site when this merger was announced. I believe that I stated that it was irresponsible (or something like that) that PE & UR made initial statements about the merger/acquisition when they had obviously not worked out many of the important details. My experiences with M/A is that you don't announce until you have ALL the details worked out and the agreements signed. And then, you deal with the fall-out from the M/A announcement and all the crap (a financial term) that is uncovered with the final stages due diligence.

I assume that this M/A will still go though. I agree with the points about the costs, financial and otherwise, and belive it would be close to catastrophic to both companies if it doesn't happen. This would not be good for the DC biz as a whole.

I don't believe that this was a marketing scam by these companies but it's clear that it was marketing driven first and the actual completion of the M/A seems to be second priority. I'm amazed at how poorly both these companies have handled the PR that should accompany any type of M/A like this. Also, above all, remember that we only know what the companies are telling us. Unless someones seen some filed SEC docs or the like, we really don't know anything about what's really going on.

Let the buyer beware ... while the rest of us are somewhat entertained by these biz follies.

RAM

TG, I think it was in their best marketing interests to announce the deal as quickly as possible. It seems to have had a favorable impact in drumming up new memberships, even if my inner cynic points to how PE and UR now seem to be resorting to rebates and incentives to get more people in under the wire.

I agree with you, though, about the huge hit the DC industry as a whole will take if this deal falls through. UE already went through a consolidation of sorts when they absorbed T&H, so absorbing new properties shouldn't be that big of a deal.

And I can also see why it's PE and not UR bringing in more new members leading up to the merger (not that I have seen anyone confirm this, beyond anecdotally). Look at the terms of both clubs. PE is the one that has unlimited nights for non-corporate accounts (since you pay by the night) and no minimum length stays. Even if I was a propsective UR member, I'd be nuts not to buy in through PE instead since pre-merger members will be supposedly grandfathered into the more lax PE terms.

However, that also means that PE can't get cocky because many of the new members over the past few months have probably been won over by the "200 properties" press release issued months ago.

Too many delays will also hurt both companies. It probably worked like a charm early in getting the fence-sitters to commit, but look at how this very board is now filled with industry watchers wondering if the deal will even go through. It certainly wasn't that way a few weeks or months ago.

Both companies need to put out a public statement out there. If anything, it can be the one final marketing push to get potential members in under the wire.

TravelGuy

It appears that both PE & UR have discovered that it's profitable to keep pushing the "wire" out as long as possible.

3DH

New twist on this merger just announced at Helium Report... "Ultimate Resort Buys Ventures Equity Vacation Club"

Hmmm... someone get the popcorn ready, this is bound to be good!

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

DC4MS

I actually heard about that a few months ago and asked them about that when I visited them in January.....they did not confirm or deny the rumor.

LTTravel

I had heard about this several months ago from a UR investor and then reported it here:
Ultimate Resort Elite New Homes

What I am surprised about is that they reported the UR/PE merger well before they had progressed but the Ventures Equity buyout was not reported till after it was final. Maybe they learned from the UR/PE merger that it takes longer than they thought and that they should probably not tell people it was "over till it was over"

I wonder why they decided not to buy the Telluride Home, which was a beautiful penthouse at the Peaks Lodge. Maybe they thought the demand for Telluride is not that great, but it was a beautiful unit. I guess they have enough homes in Cabo and decided not to buy that one.

vineyarder

Basically just amounted to the purchase of 7 homes, and this was already in progress when the PE/UR deal was announced, as these homes filled in the 'missing pieces' in the number of destinations the new club would have; i.e. they announced that the new club would have 50 destinations, but the two clubs together at that time had only 42; so these, plus others that are under contract (Pronghorn, cap cana, Ireland) represent the unexplained destinations in the combined portfolio....

3DH

Darnit... spilled my popcorn. I was hoping for a juicy debate here!

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

LTTravel

Any info on these destinations? PE has had Cap Cana in the Pinnacle on their map but not on their list of destinations for some time now. Pronghorn and Ireland on not even on their map.

vineyarder

Pronghorn is now open for reservations starting late February. Cap Cana properties (4 or 5 between the various clubs) were bought pre-construction, so they are not expected to come online until around 4Q08 or 1Q09. Ireland is under contract but I'm not sure when the closing is...

Kagehitokiri

Start The Experience
PE's original merger site says "more than 140" and "nearly 50" (properties & destinations)

PE did say what development the cap cana properties were in. i dont recall now though.

TarheelTraveler

It seems like I remember reading somewhere that those houses were leased.