Sotherly Hotels Inc. has signed a definitive agreement to be acquired by a joint venture led by Kemmons Wilson Hospitality Partners and Ascendant Capital Partners for $2.25 per share in cash. The joint venture will operate under the entity KW Kingfisher LLC.
The deal values the company at a 152.7% premium over its October 24, 2025 closing price and a 126.4% premium to its 30-day average. The merger received unanimous board approval following a recommendation from an independent committee and is expected to close in Q1 2026, pending shareholder approval and regulatory clearances. Chairman Andrew Sims has agreed to vote in favor of the transaction.
Transaction highlights
- Structure: All-cash merger with Sotherly becoming privately held under KW Kingfisher LLC
- Financing: Supported by debt commitments from Apollo and affiliates of Ascendant Capital Partners
- Preferred Stock: Holders can convert to common shares for cash consideration or retain existing terms
- Governance: Approved unanimously by Sotherly’s board following an independent review
- Timing: Expected completion in the first quarter of 2026, subject to customary closing conditions
Sotherly will continue operating its hotel portfolio until the transaction is finalized. The company will not issue a separate earnings release for the quarter ended September 30, 2025, and will instead file a Form 8-K with the Securities and Exchange Commission containing full details of the merger.
Advisors:
- Sotherly Hotels Inc. – Piper Sandler & Co. (financial advisor), Frost Brown Todd LLP (legal counsel)
- Kemmons Wilson Hospitality Partners and Ascendant Capital Partners – Bass, Berry & Sims PLC (legal counsel), Milbank LLP (debt counsel), Berkadia (financial advisor and financing arranger)
Further information regarding the merger and shareholder procedures will be provided in the forthcoming proxy statement filed with the SEC.
