Vacasa (VCSA, Financial) has announced that its Board of Directors' Special Committee has unanimously rejected the revised acquisition proposal from Davidson Kempner Capital Management. The committee concluded that this proposal does not qualify as a "superior proposal" compared to the existing merger agreement with Casago.
Several factors influenced the committee's decision. Key among them was Davidson Kempner's inability to secure necessary amendments to Vacasa's Tax Receivable Agreement (TRA), along with a lack of clear progress towards obtaining these approvals. Additionally, Davidson Kempner has not satisfied many of Vacasa's requests related to the terms and conditions necessary to enhance transaction certainty.
The committee expressed concerns about the potential risks for public shareholders, given Davidson Kempner's status as a creditor, which could pose asymmetric risks if the deal fails to materialize. Due to these issues, the proposal was deemed unlikely to be completed under its current conditions, especially considering the additional risks compared to the Casago agreement.
Despite Davidson Kempner proposing a purchase price of $5.83 per share, the Special Committee emphasized that the offer lacks the necessary certainty and actionability, particularly in light of current market volatility. As such, the committee remains committed to the merger agreement with Casago, which includes an amended offer of $5.30 per share and the elimination of purchase price adjustment provisions linked to Vacasa's liquidity and management thresholds.
The board has reaffirmed its support for the amended merger agreement with Casago and continues to recommend that Vacasa shareholders vote in favor of this transaction.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 1 analysts, the average target price for Vacasa Inc (VCSA, Financial) is $2.50 with a high estimate of $2.50 and a low estimate of $2.50. The average target implies an downside of 53.87% from the current price of $5.42. More detailed estimate data can be found on the Vacasa Inc (VCSA) Forecast page.
Based on the consensus recommendation from 5 brokerage firms, Vacasa Inc's (VCSA, Financial) average brokerage recommendation is currently 3.0, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Vacasa Inc (VCSA, Financial) in one year is $6.25, suggesting a upside of 15.31% from the current price of $5.42. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Vacasa Inc (VCSA) Summary page.
