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Investor Opposition Mounts For Extended Stay’s Takeover Plan

  • SouthernSun, Cooke & Bieler, River Road oppose $6 billion deal
  • They join two top-10 shareholders who plan to vote against it
An Extended Stay America in Old Bethpage, New York.

An Extended Stay America in Old Bethpage, New York.

Photographer: Bruce Bennett/Getty Images
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Opposition to Extended Stay America Inc.’s plans to sell itself to Blackstone Group and Starwood Capital Group is mounting with three more sizable shareholders saying they plan to vote against the deal.

SouthernSun Asset Management LLC, Cooke & Bieler LP, and River Road Asset Management LLC said they all plan to oppose the deal because the $6 billion purchase price undervalues the company. They also argue it comes at a time when Extended Stay’s prospects are strong, and have concerns about why the company chose to sell.