Ultimate Escapes takes the Destination Club public
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After almost two years of struggling through a merger and an emergency capital infusion, Ultimate Escapes is on the verge of taking the high-end resort club public.
Ultimate Escapes - the luxury travel destination firm created from Orlando-based Ultimate Resorts and Fort Collins’ Private Escapes - is the acquisition target of Secure America Acquisition Corp., a special-purpose acquisition company. The SPAC launched its $80 million initial public offering in 2007 with the sole purpose of finding a business to invest in. If a transaction is not consummated by Oct. 29, Secure America’s trust fund will be liquidated.
The deal for Ultimate Escapes, which will include a $20 million cash contribution as well as $57 million in Secure America stock, is expected to close by the end of October.
The pending deal caps two years of turmoil for Private Escapes and Ultimate Resorts. A letter of intent to merge was executed in September 2007, but hit a roadblock when it came to merging the firms’ finances. Richard Keith, chairman of Ultimate Escapes who founded Private Escapes, explained that a new credit facility was required, and as with many things, timing turned out to be everything.
“The world changed course in 2008,” Keith said. “Our lender got a little skittish and began to backpedal a little bit.”
Ultimate Resorts and Private Escapes instead entered into a joint-venture agreement. For members of the companies, it was as if the merger had been completed.
