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TRT Holdings Issues Open Letter to Gaylord Entertainment Shareholders

January 15, 2009

Expects to Nominate Four Directors at Gaylord’s Upcoming Annual Meeting of Shareholders

IRVING, Texas, Jan. 15 /PRNewswire/ — TRT Holdings, Gaylord Entertainment Co.’s (NYSE: GET) largest shareholder, with beneficial ownership of 14.99% of outstanding common shares, today issued the following open letter to Gaylord shareholders.

Robert Rowling, Chairman of the Board of Directors of TRT Holdings, said, “We believe that we can assist the Board and management team in their efforts to create value for all Gaylord shareholders. We approached Gaylord’s Board and management in an attempt to discuss improving the Company’s financial and operating performance and were rebuffed. As a result, we have decided to take our message directly to Gaylord’s shareholders. TRT seeks to bring a disciplined business approach, accountability to shareholders, and a fresh perspective based on industry experience. We believe that Gaylord’s Board and management have failed to adequately deliver in these areas.”

The full text of TRT Holdings’ letter follows:

          January 15, 2009

          Dear Fellow Shareholders of Gaylord Entertainment Co.:

          TRT Holdings, Inc. ("TRT") owns 6,131,930 shares, or 14.99%, of the
          common capital stock of Gaylord Entertainment Co. ("Gaylord").  TRT
          is the largest shareholder in Gaylord.

          We are a closely and privately held, diversified holding company
          with over $1 billion in annual revenues from operating businesses
          in the hospitality, energy, retail and fitness industries.  Through
          our ownership of Omni Hotels, we have significant experience in
          hotel and hospitality management and the ownership of hotel real
          estate.  Omni Hotels has 40 upper upscale hotels with over 14,700
          hotel rooms, more than 12,000 employees and has won numerous
          awards for customer service.  Being a closely and privately
          held company, we are especially focused on managing our business
          to create value for shareholders.

          In November 2008, we approached the senior management of Gaylord to
          discuss ideas on how TRT might become more involved at the Board
          level and assist Gaylord in creating value for its shareholders.
          Given our status as the largest shareholder and our expertise in the
          hospitality industry, we were disappointed that Gaylord management
          chose to rebuff our overture and quickly issue a press release
          publicly dismissing our efforts rather than joining us in a
          genuine search for ways to maximize shareholder value. Gaylord
          claimed our proposals were "not in the best interests of all
          Gaylord shareholders."  As a result, we feel we have no choice
          but to take our message directly to shareholders.

          We believe that we can assist the Board and management team in their
          efforts to create value for all Gaylord shareholders.  TRT's focus
          would be to bring: (1) a disciplined business approach, (2)
          accountability to shareholders, and (3) a fresh perspective based on
          our considerable industry experience.  We believe that Gaylord's
          management and Board of Directors have failed to adequately deliver
          in these areas.

          Based on our many years of owning and managing operating businesses,
          most particularly in the hospitality industry, we are convinced that
          Gaylord has lost its way and we therefore believe it is time for a
          change at the company.  For this reason, as well as to further the
          objectives described above, we expect to nominate four directors to
          stand for election at Gaylord's upcoming annual meeting.

        FAILURE TO OPERATE THE BUSINESS WITH DISCIPLINE

           -- Poor Financial Performance Relative to Peer Group.  We believe
              Gaylord's financial performance is poor.  When compared against
              an eleven member hospitality peer group for the twelve months
              ended September 30, 2008, Gaylord ranked the absolute worst in
              the following important performance metrics: return on assets,
              return on capital, and EBIT margin.  Gaylord's EBITDA margin
              was second to last among the members of the group.  In
              addition, Gaylord's results for the following measures fell
              below the peer group median: gross margin, SG&A margin and
              return on equity.  The peer group consists of Marriott
              International, Inc. (MAR), Starwood Hotels & Resorts Worldwide
              Inc. (HOT), Host Hotels & Resorts Inc. (HST), Wyndham
              Worldwide Corporation (WYN), Choice Hotels International Inc.
              (CHH), Strategic Hotels & Resorts, Inc. (BEE), FelCor Lodging
              Trust Inc. (FCH), Ashford Hospitality Trust Inc. (AHT),
              LaSalle Hotel Properties (LHO), Sunstone Hotel Investors Inc.
              (SHO), and Morgans Hotel Group Co. (MHGC).  Based on TRT's
              experience in operating the privately held Omni Hotel chain,
              we believe there is room to significantly improve Gaylord's
              operating performance.

           -- Excessive Overhead.  We believe that spending on corporate
              overhead at Gaylord is too high given the scope of its
              operations.  Gaylord has corporate overhead in excess of $50
              million to operate five hotels with approximately 8,000 hotel
              rooms.  By comparison, Omni Hotels manages to operate 38
              hotels with approximately 14,400 hotel rooms on corporate
              overhead of less than $26 million.  Based on our experience
              in the hospitality industry, we are very confident that
              Gaylord's corporate overhead could be significantly
              reduced.

           -- Corporate Waste. While many actions of the management team
              appear wasteful, in our view, the poster child for Gaylord's
              excess is its operation of a $15 million Gulfstream G150
              private jet, which it acquired at the end of 2006.  With
              only three hotels located outside of its corporate
              headquarters in Nashville - and all close to major airports -
              the purchase and operation of this aircraft seems to us to be
              anything but "in the best interests of all Gaylord
              shareholders."  Examination of the aircraft's flight log over
              the past two years reveals that the plane is often used to fly
              back and forth to locations in Mississippi and Florida, where
              Gaylord's CEO maintains a personal farm and a vacation home.
              The jet has been used at least 36 times for this purpose and
              this represents more than 25% of the total use of the plane
              (see Exhibit A attached, and also note the early Friday, or
              even Thursday, departure times for these trips).  In addition
              to this frequent personal use, Gaylord is using the aircraft
              for what appear to be questionable purposes to places such
              as Alaska, South Dakota, Brazil and Talladega (on race day).
              After two years of owning the aircraft, Gaylord decided last
              month to block public access to the flight logs.  This appears
              to be a decision to consciously avoid transparency in
              connection with the use of the plane.

           -- The Gaylord National.  There were significant cost overruns on,
              and we believe poor execution of, the construction and opening
              of the Gaylord National in Washington D.C. Gaylord originally
              announced a total budget of $530 million for the National
              project; however, the final project cost was approximately
              $1.1 billion.  Although additional rooms were added to the
              hotel, the total cost per room exceeded the original budget by
              approximately 55%.  The original budgeted cost per room was
              $353,000, compared to the final cost per room of approximately
              $550,000. In addition, the grossly over-budget project was still
              plagued with multiple problems upon opening.

           -- La Cantera.  Gaylord squandered $12 million on the aborted La
              Cantera transaction in San Antonio, Texas. On November 26, 2007,
              Gaylord announced that it had signed a definitive agreement to
              buy the Westin La Cantera Resort for $252.5 million.  On January
              22, 2008, Gaylord announced that it had negotiated a short
              extension to the closing date for the transaction in return for
              which Gaylord agreed to forfeit a $10 million deposit in the
              event the purchase contract was terminated.  On April 16, 2008,
              less than three months later, Gaylord announced that it had
              terminated the contract and lost $12 million on the transaction.
              Ask yourself whether knowledgeable, disciplined buyers of
              commercial real estate would choose to put at risk large
              non-refundable deposits before there is certainty that a
              purchase will close.

           -- ResortQuest.  In 2003, Gaylord acquired ResortQuest
              International, Inc., for approximately $200 million.  Gaylord's
              CEO and another Gaylord director were also former directors of
              ResortQuest.  We question Gaylord's logic of acquiring
              a vacation home rental business and the belief that synergies
              could be derived from combining it with Gaylord's hotel
              business.  Indeed, in what we can only describe as an
              admission of failure, about four years later Gaylord sold
              ResortQuest at a loss of approximately $55 million.  This
              misadventure was under the watch of the current management
              team and a majority of the current Board.

        LACK OF ACCOUNTABILITY TO SHAREHOLDERS

           -- Hand Picked Board.  While each Board member is a respected and
              accomplished individual, we believe the Board has been hand
              picked by management and has not held management sufficiently
              accountable. A majority of the Board members have a long history
              of interconnected relationships with each other through
              affiliations with other companies and Boards, specifically,
              First Horizon National Corp., ResortQuest International, Inc.,
              Harrah's Entertainment, Inc., and Promus Companies, Inc.  We
              question whether such a close-knit Board can effectively
              challenge its friends in management.

           -- Separation of Duties.  The role of the Chairman of the Board
              and Chief Executive Officer should be immediately separated.
              We also question whether a Chairman who is CEO has the ability
              to challenge management decisions.

           -- Excessive Compensation.  We believe that management
              compensation is excessive given the limited scope of Gaylord's
              operations.  Gaylord's CEO made total reported compensation
              of $3,874,886 in 2007.  The top management is compensated
              comparably with much larger and more complex hotel companies.

          In its press release dismissing our efforts to help bring value
          to the company and its shareholders, Gaylord expressed concerns
          over potential conflicts of interest that could arise if
          designees of TRT assume an active role on Gaylord's Board due
          to TRT's ownership of the Omni Hotels chain.  We believe this
          concern to be unfounded.  We believe it is very common and
          very simple to put in place reasonable procedures that would
          address the rare instance in which a conflict of interest
          might arise at the Board level.  Further, aside from the
          undersigned, we intend to nominate director candidates who have
          no affiliation with Omni Hotels or TRT.

          As Gaylord's largest shareholder, our interests are fundamentally
          aligned with those of all shareholders.  Our motives are not
          conspiratorial.  We have watched from the sidelines with
          mounting alarm as the value of our investment in Gaylord has
          declined under the watch of the incumbent Board.  Unlike
          management, we do not draw rich salaries from Gaylord's
          coffers.  Instead, like you, we only stand to benefit from
          our efforts if we succeed in enhancing shareholder value.

          In conclusion, TRT has years of experience in owning, growing
          and managing operating businesses, especially in the hospitality
          industry.  Our focused, disciplined approach to operating in the
          hospitality space, coupled with our willingness to hold managers
          accountable to the owners of the business, has proven to be a
          successful formula for us and we believe it will benefit
          Gaylord as well.   While we remain disappointed and surprised
          that management and the Board refuse to accept the help of a
          large shareholder with significant experience in the hospitality
          industry, we nevertheless continue to stand firmly committed
          to righting the course at Gaylord.  It is our intention to
          nominate a slate of four highly qualified and experienced
          directors to serve on Gaylord's Board in our campaign to
          strengthen Gaylord for the benefit of all of its shareholders.

          Sincerely,

          /s/ Robert B. Rowling

          Robert B. Rowling
          Chairman of the Board of Directors
          TRT Holdings, Inc.

          (Exhibit A: http://www.newscom.com/cgi-bin/prnh/20090115/NY59415 )

About TRT Holdings

TRT Holdings is a privately-owned, diversified holding company located in Irving, Texas. Assets include the luxury hotel brand, Omni Hotels, Gold’s Gym International, Tana Exploration, Waldo’s Dollar Mart in Mexico and numerous investments in public companies and various real estate ventures.

IMPORTANT INFORMATION

TRT HOLDINGS, INC. AND ROBERT B. ROWLING (THE “PARTICIPANTS”) INTEND TO FILE A DEFINITIVE PROXY STATEMENT AND OTHER SOLICITING MATERIALS WITH THE SECURITIES AND EXCHANGE COMMISSION (THE “SEC”) IN CONNECTION WITH THE ELECTION OF ITS DIRECTOR NOMINEES AT THE COMPANY’S 2009 ANNUAL MEETING OF STOCKHOLDERS. STOCKHOLDERS ARE URGED TO READ THE DEFINITIVE PROXY STATEMENT AND OTHER SOLICITING MATERIALS AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. THE DEFINITIVE PROXY STATEMENT AND OTHER SOLICITING MATERIALS WILL BE AVAILABLE AT NO CHARGE ON THE SEC’S WEB SITE AT HTTP://WWW.SEC.GOV. IN ADDITION, THE PARTICIPANTS WILL PROVIDE COPIES OF THE DEFINITIVE PROXY STATEMENT AND OTHER SOLICITING MATERIALS WITHOUT CHARGE UPON REQUEST. REQUESTS FOR COPIES SHOULD BE DIRECTED TO THE PARTICIPANTS’ PROXY SOLICITOR, INNISFREE M&A INCORPORATED, AT ITS TOLL-FREE NUMBER: 888-750-5834.

INFORMATION RELATING TO THE PARTICIPANTS IN THIS PROXY SOLICITATION IS PROVIDED IN A SCHEDULE 13D THAT WAS FILED BY THE PARTICIPANTS WITH THE SEC ON JULY 21, 2008 WITH RESPECT TO THE COMPANY, AS AMENDED AND FILED WITH THE SEC ON JANUARY 15, 2009. THIS INFORMATION IS AVAILABLE AT NO CHARGE AT THE SEC’S WEBSITE AT HTTP://WWW.SEC.GOV.

Forward-Looking Statements

Some of the statements contained in this press release include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended. Forward-looking statements can be identified by the use of words such as “anticipate,” “believe,” “estimate,” “may,” “intend,” “expect” or other similar expressions. Forward-looking statements involve substantial risks and uncertainties that could cause actual results to differ materially from those in such statements, including, but not limited to, those risks and uncertainties set forth in Item 1A- Risk Factors of Gaylord’s Annual Report on Form 10-K for the year ended December 31, 2008. Additionally, while these forward-looking statements were prepared based on the best information available to TRT, they were not prepared with the benefit of access to Gaylord’s books and records, and the accuracy and completeness of financial and other information obtained from publicly available sources and used in preparing these forward-looking statements has not been independently verified. Accordingly, you should not unduly rely on forward-looking statements as a prediction of actual results. TRT assumes no obligation or duty to update any forward-looking statements in this press release or any other soliciting materials.

    Contacts:

    Dan Katcher / Annabelle Rinehart
    Joele Frank, Wilkinson Brimmer Katcher
    (212) 355-4449

SOURCE TRT Holdings


Source: newswire



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