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US: Vacation rental platform Vacasa has announced that it has accepted its proposal from property management franchise company Casago to increase the price of its pending acquisition.Â
Vacasa has agreed to an increased acquisition offer from Casago, raising the price to $5.30 per share in cash.
The company’s board of directors approved the revised deal, rejecting a competing offer from investment firm Davidson Kempner Capital Management, which offered to acquire 100 per cent of the company at a price of $5.25 per share.
After consideration, the company confirmed that entering an agreement with Casago was in the best interests of Vacasa’s public shareholders.
Casago is now set to acquire all outstanding shares of Vacasa. As part of the revised agreement, Casago has also removed certain financial conditions that could have reduced the final payout.
Vacasa’s special committee reviewed a rival $5.75 per share offer from Davidson Kempner but determined it did not provide the same level of certainty. Davidson Kempner’s proposal was contingent on changes to Vacasa’s tax receivable agreement (TRA), which lacked required approvals.
The company now aims to finalise the deal by the end of April. Vacasa shareholders will receive a proxy statement with more details ahead of a vote on the acquisition.
The move comes after a challenging few years for Vacasa, which carried out four layoff rounds over the past three years. Multiple key executives have also departed from the company over the past couple of years, including including chief operating officer John “JB” Banczak, chief financial officer Jamie Cohen chief commercial officer Craig Smith, and chief technology officer Jeff Flitton.
As of last year, Vacasa’s portfolio stood at just over 40,000 homes in destinations across the United States, Belize, Canada, Costa Rica and Mexico, marking roughly a nine per cent drop compared to the previous year.
Vacasa had also gone public on the Nasdaq Global Select Market in December 2021 via a merger with special purpose acquisition company TPG Pace Solutions, raising $340 million in gross cash proceeds in the process and debuting with a valuation of $4.4 billion. Following this move, its share price subsequently dropped from $203.20 to $4.85 at the time of writing.
Joe Riley, president of Casago, said: “The decision to enhance our offer indicates our commitment to closing this transaction as quickly as possible. Homeowners and industry partners have responded positively to the December 30th merger announcement, and to our shared vision of empowering local teams to provide exceptional hospitality through an owner centric approach.”
