- Following a strategic review by newish CEO Richard Stockton, Ashford Prime (AHP) promises a focused portfolio on the luxury chain segment, a 33% increase in the quarterly dividend to $0.16 per share. a conservative leverage target of 45% net debt to gross assets, and strong liquidity - 10-15% of gross debt in cash.
- The management contract with Ashford Inc (AINC) is also amended to make it more friendly to the owners of AHP, including removal of the tax gross-up provision and 1.1x multiple from the calculation of the termination fee. Also, a change in the majority of the board will no longer trigger a termination fee.
- In other news, the company closed on the refinance of three mortgages with outstanding balances of $334M. The new loan totals $365M, with interest rate of Libor +2.58%. Ashford expects about $12M in P&I savings annually based on the current state of the Libor forward curve.