Bill Gates’s Cascade Investment has increased its stake in Strategic Hotels & Resorts Inc. and indicated that it may potentially be involved in a takeover as the luxury-hotel owner explores a sale.
Cascade purchased about 1.74 million shares of Chicago-based Strategic Hotels since early March, increasing its stake to 9.8 percent, the investment firm said in a regulatory filing Monday. After recent press reports of a potential sale, Cascade has decided to approach the hotel company about exploring alternatives, “including the possibility of the reporting persons being a party to a transaction involving the acquisition of the issuer,” according to the filing.
Strategic Hotels rose 5.1 percent to $13.90 in New York trading, the biggest gain in two years. The company, the owner of properties including the Ritz-Carlton Half Moon Bay in California and Manhattan’s Essex House, has a market value of about $3.8 billion.
Bloomberg reported last month that Strategic Hotels has been exploring a sale and hired a bank to help it find a buyer. Strategic’s adviser has contacted potential suitors to gauge their interest, according to people with knowledge of the matter, who asked not to be identified because the process is private.
“We acknowledge that Cascade has filed a 13D amendment regarding Strategic Hotels,” Raymond “Rip” Gellein, the hotel company’s chairman and chief executive officer, said in an e-mailed statement Monday. “We are always open and available to speak with all of our shareholders.”
Michael Larson, Cascade’s chief investment officer, didn’t return a telephone message seeking comment. The firm held about 9.2 percent of Strategic Hotels in March, regulatory filings show. It is the real estate investment trust’s second-largest shareholder, after Vanguard Group, according to data compiled by Bloomberg.