This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration. Need a new registration confirmation email? Click here
NEW YORK (
TheStreet) -- After a lull, the stakes are rising in a bidding war between private equity firms
KSL Capital Partners and
Apollo Global Management(APO - Get Report) for theme park and hotels operator
Great Wolf Resorts(WOLF).
After meeting an earlier $7 bid by KSL, Apollo management reacted to a $7.25 rebuttal bid made earlier this week by KSL with its biggest raise yet on Friday -- a 60 cent increasing its offer to $7.85. The rising stakes in the private equity buyout of Great Wolf Resorts have its takeover price closing in on what frustrated shareholders and analysts target as the company's fair value.
A sale process that began with a $5 per share bid by Apollo and accepted by Great Wolf Resorts in March has proven dramatic for the emergence of a competing bidder in KSL. While management has sided repeatedly with Apollo bids at $5, $6.75 and most recently $7, KSL has raised the private equity giants bid each time. With a $7.85 bid on Friday morning, Apollo appears to be in it for the win, while KSL lingers.
At issue throughout the takeover, beginning with Great Wolf's board approval of a $5 offer by Apollo on March 12, has been whether offers reflect a fair value. Meanwhile, Great Wolf Resorts has accepted multiple Apollo bids without fully engaging KSL, even as offer prices stalled at $7. But after Apollo raised its offer to $7.85, Great Wolf Resorts epic sale process and KSL's role as a rival seems to be tilting in shareholders favor.
Another mystery is why a public blow-for-blow bidding war emerged after Great Wolf Resorts conducted what it told
Bloomberg News was a nine-month auction process that only netted bids in the $5 range.
Apollo's offer represents a 87% premium to Great Wolf Resorts closing share price prior to announcing its acceptance of an initial $5 offer. The 60-cent bid increase to $7.85 also is in line with some analyst expectations and brings the loss-making company near its fair valuation.