It was announced this morning that Gaylord Entertainment Company is spinning off its Gaylord Hotel brands to Marriott International Inc. for $210 million. According to the Gaylord press release, the Nashville-based company will continue to own the properties and will reorganize as a real estate investment trust effective January 1, 2013. Analysts had suspected such a move was possible, as Gaylord CEO Colin Reed had said the company was exploring ways to "unlock" shareholder value.
The details of the sale and transaction are detailed on various websites including the Nashville Tennessean and Nashville Business Journal. The deal is subject to the approval of Gaylord stockholders. The initial reaction from Wall Street is that they like the deal as Gaylord stock was up 6% today, or almost $2.00 a share.
As far as the Grand Ole Opry is concerned, Gaylord will continue to own and operate the Grand Ole Opry, Ryman Auditorium and other attractions as taxable REIT subsidiaries. According to the press release, "nothing will change at these iconic assets of the Nashville community, and Gaylord is fully committed to maintaining the legacy of these historic attractions."
My initial reaction is that we shall see. With Gaylord turning over the management of the hotels and resorts to Marriott while retaining ownership, I have to wonder if the same might happen to the Opry. That is, could Gaylord maintain ownership but at some point turn over the management of the Opry to someone else.
Time will tell, but the hope is that once Gaylord gets themselves straightened out financially they will put more money and effort into the Opry.
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