Skip to main content

Park Hotels & Resorts (PK) on Monday said it agreed to buy rival Chesapeake Lodging Trust (CHSP) in a cash-and-stock deal valued at $2.7 billion that will create the second-biggest lodging real estate investment trust in the U.S.

Park Hotels' offer of $31.71 a share represents a premium of about 8% to Chesapeake Lodging's Friday closing price. In early trading on Monday, shares of Chesapeake jumped 5.8% to $31.02 on the Nasdaq Stock Exchange. 

The deal is expected to close toward the end of the third quarter or in the fourth quarter, Park Hotels said a statement. The combined entity will have an enterprise value of about $12 billion.

Park Hotels' portfolio of properties consists of 51 premium-branded hotels and resorts, which have more than 30,000 rooms throughout the U.S. Chesapeake Lodging owns 20 hotels, which have a total of 6,288 rooms in eight U.S. states and the District of Columbia.

Scroll to Continue

TheStreet Recommends

Separately, Park Hotels reported first-quarter earnings that exceeded analysts' forecasts. The company said it earned $97 million, or 48 cents a share, vs. $149 million, or 71 cents a share, in the comparable year-earlier quarter. Analysts polled by FactSet had been expecting earnings of 30 cents a share.

Shares of Park Hotels were down 3.2% at $31.92 in early trading on on the New York Stock Exchange on Monday.