Paulson & Co Trims Extended Stay America Stake ~ market folly

Friday, October 7, 2016

Paulson & Co Trims Extended Stay America Stake

John Paulson's hedge fund firm Paulson & Co has filed a couple of SEC filings regarding its paired shares in Extended Stay America (STAY) and ESH Hospitality.

The Form 4 filed indicates that Paulson & Co sold 4,983,333 paired shares in total, at a price of $14.16 per share on October 4th.

After these sales, Paulson still owned 37.67 million shares of STAY, or 19% of the company.

A press release from Extended Stay America indicates that they recently announced a secondary offering of paired shares, each paired share consisting of a share of common stock of STAY and a share of class B stock of ESH Hospitality.  Paulson & Co, Centerbridge Partners, and Blackstone Group were the selling stockholders. 

The company also announced a share repurchase agreement where they repurchased 1.95 million paired shares from the sellers.

We've also posted other recent portfolio activity from Paulson & Co here.

Per Google Finance, Extended Stay America is "an integrated owner/operator of company-branded hotels in North America. The Company operates in hotel operations segment. Its business operates in the extended stay lodging industry. It owns and operates approximately 630 hotels comprising over 69,400 rooms located in approximately 40 states across the United States and in Canada. It owns and operates its hotels under its core brand, Extended Stay America, which serves the mid-price extended stay segment. In addition, it owns and operates over three Extended Stay Canada hotels. It operates its hotels owned by ESH Hospitality, Inc. (ESH REIT). The hotels are operated by the Operating Lessees, subsidiaries of the Company and are managed by ESA Management LLC (ESA Management), a subsidiary of the Company. ESH Strategies, a subsidiary of the Company, owns the brands related to its business. The Company's extended stay hotels are designed to provide lodging or apartment accommodations."

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