NEW YORK - In a recent development, Blackwells Capital LLC, an investor in Braemar Hotels & Resorts Inc. (NYSE: BHR), has made a public appeal to fellow shareholders to support its bid to elect four new candidates to the company's board of directors at the upcoming annual meeting on July 30, 2024. The investor group, which has been critical of Braemar's current board and management, is advocating for a significant overhaul, arguing that the current leadership has led to considerable value destruction for shareholders.
Blackwells Capital has nominated Jennifer M. Hill, Betsy L. McCoy, Steven J. Pully, and Michael Cricenti as alternative directors, contending that the present board is not acting in the best interests of all shareholders. The investment firm has expressed concerns over Braemar's advisory agreement with Ashford Hospitality (NYSE:AHT) Advisors LLC, labeling it as 'extortionary' and detrimental to shareholder value. Moreover, Blackwells has highlighted the termination fee payable to Ashford (NYSE:AINC) and Mr. Monty Bennett, which it views as indicative of self-serving practices that prioritize the interests of Ashford and Mr. Bennett over those of the broader shareholder base.
Jason Aintabi, Chief Investment Officer of Blackwells, has urged shareholders to review the firm's materials and join their efforts to elect a board that will prioritize shareholder interests. Blackwells has set up a campaign website and social media presence to disseminate information and rally support for its cause.
This move by Blackwells Capital comes amid a backdrop of legal contention, with Braemar having filed a lawsuit against Blackwells and its associates in the United States District Court for the Northern District of Texas. The lawsuit seeks to prevent Blackwells from soliciting proxies and to declare its nominations invalid due to alleged non-compliance with the company's bylaws. Blackwells, however, maintains that the claims have no merit and is proceeding with its campaign to reshape the board.
The outcome of this proxy battle and the associated legal disputes will be closely watched by investors and market observers, as it may have significant implications for the governance and strategic direction of Braemar Hotels & Resorts. This report is based on a press release statement from Blackwells Capital LLC.
InvestingPro Insights
As shareholders weigh the merits of Blackwells Capital's bid to revamp the board of Braemar Hotels & Resorts Inc. (NYSE: BHR), a look at some key metrics and insights from InvestingPro could provide a clearer picture of the company's financial health and market position. According to InvestingPro data, Braemar Hotels & Resorts has a market capitalization of approximately $197.56 million, indicating the size of the company in terms of stock market valuation. Despite challenges, the company has managed a revenue growth of 10.43% over the last twelve months as of Q4 2023, signaling potential resilience in its core business operations.
InvestingPro Tips highlight that Braemar Hotels & Resorts is trading at a low EBITDA valuation multiple, which could suggest that the company’s earnings before interest, taxes, depreciation, and amortization are undervalued compared to its market cap. This can be an important consideration for investors looking for value opportunities. Furthermore, the company pays a significant dividend to shareholders, with a notable dividend yield of 7.43% as of the latest data, which could appeal to income-focused investors.
For those interested in a deeper dive into Braemar Hotels & Resorts' financials and market performance, InvestingPro offers a comprehensive suite of tips and real-time data. There are 12 additional InvestingPro Tips available, which could further inform shareholders' decisions as they approach the upcoming annual meeting. To explore these insights, visit https://www.investing.com/pro/BHR and consider using the coupon code PRONEWS24 to receive an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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