Aimbridge Reaches Agreement with Lenders to Right Size Balance Sheet and Significantly Strengthen Financial Position
Expects to Complete Balance Sheet Restructuring on an Expedited Basis
Agreement with Lenders Converts More than $1.1 Billion in Debt to Equity and Infuses $100 Million in New Capital
All Operations to Continue in the Normal Course; Ample Liquidity to Fulfill All Commitments to Associates, Hotel Owners, Brand Partners, Suppliers, and Vendors
PLANO, Texas, January 16, 2025 — Aimbridge Hospitality, a leading, global hotel management company and the world’s largest third-party hotel operator, today announced that it has entered into a Restructuring Support Agreement (RSA) with overwhelming support from its first and second lien lenders and its existing sponsor that would right-size the Company’s capital structure by converting more than $1.1 billion in debt to equity, and infuse $100 million in new capital, significantly strengthening the Company’s financial position.
Pursuant to the transaction contemplated by the agreement, which has the support of more than 80% of the Company’s first lien lenders, 100% of its second lien lenders, and its existing sponsor, Aimbridge’s total debt outstanding would be significantly reduced to a maximum of $210 million at close from $1.3 billion today, and Aimbridge would have one of the healthiest balance sheets in the industry. This transaction would be facilitated by the Company’s current first lien lenders, which would provide a $100 million capital injection and become majority owners of the Company, building on their long-term commitment to Aimbridge and reflecting their confidence in Aimbridge’s strong future and business strategy.
“We are excited to announce an agreement that will transform our balance sheet and put Aimbridge in an incredibly strong position to accelerate our long-term strategy and continue delivering top-of-the-line services to our hotel owners,” said Craig S. Smith, Aimbridge Hospitality CEO. “Over the past year, we have been enhancing our differentiated service offerings, investing in top talent, and making strategic and operational improvements to drive hotel performance. We have a clear strategy and execution plan in place – and with a strengthened balance sheet, we will be even better positioned to continue investing in our operational capabilities, winning new business in existing and new markets, and strengthening our leading position in the industry.
“In taking this important step, we are pleased to have the strong support of our lenders, who share our excitement about the significant potential to enhance value for our stakeholders, and we appreciate the ongoing commitment of our associates and valued partners. We look forward to continuing to deliver operational excellence, best-in-class guest experiences, and innovative solutions to our hotel owners,” Smith concluded.
The implementation process for the restructuring is underway and is expected to be completed in the first quarter of 2025. Throughout this process, Aimbridge will continue to operate its business as usual. The Company has ample liquidity to support the seamless continuation of its operations and fulfill commitments to associates, hotel owners, brand partners, suppliers, and vendors. Specifically, associates will continue to receive salaries and benefits in the normal course, and all vendors and suppliers will be paid in the ordinary course of business.
Aimbridge’s executive leadership team will remain in place, with Steve Joyce continuing to serve as the Chairman of the Board, Craig S. Smith as Chief Executive Officer and Eric Jacobs as Chief Global Growth Officer, with strong support from an independent board with significant hospitality and leadership experience.
Additional Information
Additional information about the balance sheet restructuring is available at StrongerAimbridge.com.
Advisors
Ropes & Gray LLP is serving as legal counsel; Evercore is serving as investment banker; and AlixPartners LLP is serving as financial advisor to Aimbridge.
Gibson, Dunn & Crutcher LLP is serving as legal counsel and Moelis & Company LLC is serving as the exclusive financial advisor and investment banker to the ad hoc group of first lien lenders.
Paul, Weiss, Rifkind, Wharton & Garrison LLP is serving as legal counsel and Houlihan Lokey is serving as financial advisor to the ad hoc group of second lien lenders.
Cahill Gordon & Reindel LLP is serving as legal counsel and RPA Advisors is serving as financial advisor to JPMorgan Chase Bank, N.A., as Administrative Agent.
Weil, Gotshal & Manges LLP is serving as legal counsel to the existing sponsor.
About Aimbridge Hospitality
Aimbridge Hospitality is the world’s leading global hospitality management company. A trusted operator of over 80 globally recognized lodging brands and distinctive luxury and lifestyle assets, Aimbridge delivers compelling results for hotel owners by leveraging proprietary data and insights as an authority in key markets and destinations, while creating exceptional guest experiences. Aimbridge continually strives to set the new standard in hospitality excellence, leading the industry into the future through a wealth of unmatched resources and best-in-class supplier agreements, while recruiting and developing top industry talent in all key verticals and geographies. To learn more, visit www.aimbridgehospitality.com. Connect with Aimbridge on LinkedIn.
Media Contact
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Forward-Looking Statements
This press release may contain forward-looking statements that involve substantial risks and uncertainties. These forward-looking statements include, but are not limited to projections, statements regarding the company’s expected future performance, future financial condition, anticipated operating results, strategy plans, future liquidity and financial position. Any forward-looking statement made by the Company in this press release speaks only as of the date on which such statement was made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for the Company to predict all of them. The Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
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