Soho House signs definitive going private agreement

Soho House (SHCO) has entered into definitive agreements pursuant to which an investor group led by MCR and its Chairman and CEO Tyler Morse will acquire the outstanding shares of Soho House not held by certain significant shareholders. SHCO Executive Chairman Ron Burkle and the Yucaipa Companies LLC (“Yucaipa”) will roll their controlling equity interests in the company and retain majority control of the business. Holders of common stock of the company will receive $9.00 per share in cash, a premium of approximately 83% over the closing stock price as of December 18, 2024, the last trading day prior to Soho House’s announcement of receipt of the offer. The offer implies a total enterprise value of approximately $2.7B for SHCO. MCR, the third largest hotel owner-operator in the U.S., will become a shareholder of SHCO and Tyler Morse will join the company’s Board of Directors as Vice Chairman. MCR’s portfolio includes iconic assets such as the TWA Hotel at JFK Airport, The High Line Hotel and the Gramercy Park Hotel in New York City and the BT Tower in London. Funds managed by affiliates of Apollo are supporting the transaction through a hybrid capital solution, by providing additional capital in the form of debt and common equity, a portion of proceeds will be used to refinance the company’s existing Senior Secured Notes. Existing significant shareholders including Richard Caring, Nick Jones and Goldman Sachs Alternatives, will roll the majority of their shares of the common stock of the company. Goldman Sachs Alternatives is also committing additional capital. The Board of Directors unanimously approved the proposed transaction. The proposed transaction is expected to close by the end of 2025, subject to regulatory approvals and other closing conditions. Upon completion of the proposed transaction, SHCO’s common stock will cease trading on the NYSE.