IRVING, TX—La Quinta Holdings Inc. is considering a sale of the company, seeking a high valuation as it plans to spin off real estate assets in the hopes of making the impending tax hit “more palatable to shareholders,” according to anonymous sources cited in a Reuters article.
La Quinta is preparing to engage with potential buyers once it files a Form 10 with the U.S. Securities and Exchange Commission registering the spinoff, which is expected to come in the second quarter of 2017, according to the report. Hotel Business reached out to La Quinta Holdings for comment and the spokesperson stated, “We do not comment on market rumors or speculation.”
The company announced it was pursuing the separation of its businesses into two standalone publicly-traded companies, including spinning off owned real estate assets as a separate company, at the beginning of the year. While there was no assurance that the separation would occur, President and CEO Keith Cline said at the time that the separation of the real estate business from the franchise and management business “could enable greater strategic clarity and allow us to take advantage of growth opportunities that naturally flow from each business model.”
He also noted at the time that the company would be “focused on minimizing tax leakage.”