Key facts
- Al Shams Investments, Braemar Hotels & Resorts' largest shareholder, is challenging a $480 million termination fee to outgoing chairman Monty Bennett.
- Al Shams Investments described the fee as 'theft dressed in a suit' and a 'brazen act of self-dealing.'
- Braemar plans to sell assets, including three hotels for $437.5 million, to fund the termination fee to Ashford Inc., led by Bennett.
- The deal involves the resignation of five Braemar board members, including Bennett, with CEO Richard Stockton remaining.
- Al Shams Investments owns approximately 9.5% of Braemar's stock and has vowed to pursue legal remedies.
Al Shams Investments, the largest shareholder in Braemar Hotels & Resorts, has launched a strong public challenge against the REIT's plan to pay a $480 million termination fee to its management company, Ashford Inc., led by outgoing chairman Monty Bennett. Al Shams Investments has characterized the transaction as 'theft dressed in a suit' and a 'brazen act of self-dealing,' alleging that Bennett engineered the outcome to benefit himself.
Braemar's board stated that the deal aims to simplify its corporate structure and allow for new board recruitment, with the REIT selling assets, including three hotels for $437.5 million, to cover the fee. The agreement also includes the resignation of five board members, including Bennett, while CEO Richard Stockton will remain. Al Shams Investments, which owns approximately 9.5% of Braemar's stock, has vowed to pursue all available legal remedies against those involved and has previously criticized the board for governance changes perceived to dilute shareholder control. Braemar Hotels & Resorts defended its actions, stating it worked to maximize shareholder value.