Red Lion Hotels Corporation

Red Lion Hotels Corporation

Type	Public
Traded as	NYSE: RLH
Industry	Hospitality, Hotels
Founded	Spokane, Washington, United States (1937)
Headquarters	Spokane, Washington, United States
Area served	United States, Canada
Key people	Greg Mount (President & CEO)
Revenue	USD 142.92 Million (2015)
Operating income	USD 13.88 Million (2015)
Net income	USD 2.7 Million (2015)
Total assets	USD 287.22 Million (2015)
Total equity	USD 167.60 Million (2015)
Number of employees	1,783 (2015)
Website	www.redlion.com/rlhc

Red Lion Hotels Corporation is an American hospitality corporation that primarily engages in the franchising, management and ownership of upscale, midscale and economy hotels. The company also operates an entertainment and event ticket distribution division, TicketsWest.

Red Lion, headquartered in Spokane, Washington, has 73,200 rooms across more than 1,100 properties (as of October 2016^[1]) in North America.

History

Establishment and diversification

The company originated as a property management and commercial development company when it was founded in Spokane, Washington in 1937 under the name Goodale & Barbieri Company. In 1976, Goodale & Barbieri acquired the River Inn in Spokane, launching the company into the hotel business.^[2] The Cavanaughs brand name was later created in 1980 for its hotel operations. By 1987, the company established a computerized event ticketing company, G&B Select A Seat, which is now known as TicketsWest.

1990s–2000s: IPO, acquisitions, and rebranding

Red Lion Hotels Corporation headquarters

Preparing for an Initial Public Offering, Goodale & Barbieri Company adopted its hotel brand into its corporate identity in 1997, changing its name to Cavanaughs Hospitality Corporation. The IPO was completed in April 1998, and Cavanaughs began trading under the ticker CVH.^[3] By the end of 1999,^[4] Cavanaughs announced it would acquire its regional rival, Seattle-based WestCoast Hotels, Inc. with transaction closing on January 7, 2000.^[5] On March 1, 2000, the combined company began trading under the new ticker, WEH.^[6] Recognizing the broader geographic reach of the WestCoast name, Cavanaughs also changed its name to WestCoast Hospitality Corporation with the launch of its new stock ticker and announced plans to rebrand its hotels into the WestCoast name.^[7]

In addition to the expanded hotel portfolio following the acquisition of WestCoast, the company also announced plans to franchise properties under its brand.^[8]

By 2001, the company grew again; this time by announcing it would acquire the Red Lion Hotels and Inns brand and properties (along with several other DoubleTree properties) from Hilton Hotels.^[9] Capitalizing on the Red Lion brand, a majority of the company's WestCoast Hotels properties were rebranded to the Red Lion name within the two years following the acquisition. In September 2005, further realizing the revitalization of the Red Lion name, WestCoast Hospitality Corporation assumed its present-day name, Red Lion Hotels Corporation.

In 2006, RLHC divested its property development operations by spinning-off that segment into an independent entity, G&B Real Estate Companies.

2010s: Acquisitions and major expansion

Red Lion Hotels Corporation further expanded its hotel operations. In October 2014, RLHC announced a new upscale conversion brand, Hotel RL. In April 2015, RLHC acquired GuestHouse International, LLC and its two brands, GuestHouse International and Settle Inn & Suites, from Boomerang Hotels in a deal with up to $10 million.^[10][11] The acquisition more than doubled Red Lion's size from 57 properties to 130^[12] properties and added 5,187 rooms to its portfolio.^[13]

In September 2016, RLHC acquired Vantage Hospitality Group and its brands Vantage Hotels, Americas Best Value Inn, Canadas Best Value Inn, Lexington by Vantage, America's Best Inns and Suites, Country Hearth Inns, Jameson Inns, Signature Inn, and 3 Palms Hotels & Resorts.^[14][15]

Red Lion brands

Hotels

Red Lion Hotels Corporation operates five hotel brands, each covering a different market segment:

Upscale

• Hotel RL

Midscale

• Red Lion Hotels

Select-service lodging

• Red Lion Inn & Suites

Economy lodging

• GuestHouse

Extended-stay lodging

• Settle Inn Extended Stay

Franchising

The Franchise Segment licenses the Red Lion brand to third-party hotel owners. As of 2009 there were approximately 17 franchised Red Lion hotels. Hotel owners can franchise as either a full service Red Lion Hotel, which offer restaurant and banquet meeting space; a limited service Red Lion Inn & Suites; or under the Leo Hotel Collection, for unique, boutique or historic hotels.^[16] The Las Vegas Hotel & Casino was the first hotel to join the Leo Collection in February 2013.^[17]

Entertainment Segment (TicketsWest)

Founded in 1987 as G&B Select-A-Seat, a computerized ticketing service, TicketsWest is a minor, regional competitor to Ticketmaster and provides ticket sales and distribution services to concert and sports venues in several western United States. In 2007 it accounted for approximately 8% of company revenues.^[18]

Loyalty program

RLHC operates a loyalty program called Hello Rewards.

Controversies

In mid-2008 Columbia Pacific Opportunity Fund, an investment manager for the Baty family, the Seattle founders of Emeritus Corporation, submitted an unsolicited acquisition offer of $9.50 per share to acquire Red Lion.^[19] At the time, Columbia Pacific held 12.7 percent of Red Lion.

By October Columbia Pacific had withdrawn its offer and, shortly thereafter, the Red Lion board of directors enacted a poison pill plan, drawing the ire of Columbia Pacific who stated its belief that Red Lion should be liquidated because company-owned assets were in "excess of Red Lion's market capitalization."^[20]

Later that year, after the share price increased significantly, Red Lion removed its poison pill.

References