Wyndham Packages Capital Restructuring Plan

In-depth details, including the cost, will be made available in four to six weeks when the Dallas-based hotelier rolls out the prospectus, a company spokeswoman tells GlobeSt.com. According to this morning's press release, a group of investors--representing 90% of the company's outstanding common stock and 49% of the voting power--are seeking to convert Series A and Series B preferred shares into common stock. "It won't affect the day-to-day operations," Wyndham's spokeswoman stresses.

If the deal closes, the one-time preferred stockholders will own about 85% of the outstanding common stock while existing common stock holders will end up with the balance in their portfolios. Wyndham's stock this morning was 75 cents per share on the Amex index.

To work through the details of the deal, Wyndham has set up a subsidiary to be merged into the parent company, according to the spokeswoman. The release specifies safeguards are in place for minority shareholders for a period of time following the closing. The pending deal also calls for a reduction in the board--another detail that will come out in the prospectus.

The recapitalization plan is subject to regulatory approvals and must get stockholders' clearance. At least two-thirds of the Series B preferred stockholders must OK the plan.

The board-approved plan was put together by a special committee, advised Wyndham's directors set up a special committee to craft the plan, which already has garnered full board approval. Morgan Stanley was the committee adviser. The Wyndham release says Morgan Stanley deemed the impact on the Class A common stock as "fair from a financial point of view to the holders of such shares."