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This is a pretty surprising move, especially in light of the Westgate poison pill efforts. I have no idea how this will impact Bluegreen Vacation Club owners. I am not sure how much of the details of these talks will be shared with outside parties. So, I don't expect a lot of guidance on this topic.
We will have to ask our Sunterra friends how they have been treated in the acquisition process.
I have personally been involved in mergers and acquisitions. Whenever companies I have been involved in were sold, we announced definitive agreements subject to due diligence. In this case, it appears that a price has been agreed, but there aren't any definitive agreements. Not sure if that is unusual in this industry.
Sometimes, when companies are in trouble, they announce intentions of finding strategic alternatives for the company which is code for potential acquirers. I really didn't think that Bluegreen was in any financial trouble with the exception of their residential home business. But, I don't think Diamond is interested in acquiring that business. It will probably spin that part of the business off.
I do expect that the direction we will get from Bluegreen is that everything is status quo until they get a definitive agreement in place sometime around the time of the annual meeting.
Just remember this, the Bluegreen Vacation Club is owned by owners. So, the Club itself will operate much as it does today. What is likely to change are the organizations that serve customers and the policies surrounding the Club like transfer costs and rules.
It just got a whole lot more exciting around here.
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