Hotelier Gaylord Partners with Parton, Rumbles with Rowling

Associated Press
Dolly Parton at the Dollywood theme park in Pigeon Forge, Tenn. in 2010. She is partnering with Gaylord Entertainment on a new amusement park.

Convention-resort owner Gaylord Entertainment Co. mingled with the rich and famous this week, partnering with singer Dolly Parton to build a water park adjacent to its Nashville hotel and tangling with Texas billionaire Robert Rowling over its takeover defenses.

Gaylord, owner and operator of four massive resort complexes of more than 1,500 rooms each, on Thursday announced it will partner with Dollywood Co. to build a 50-acre amusement park for water and snow activities adjacent to its 2,881-room Gaylord Opryland hotel and convention center by 2014.

Gaylord will contribute to the venture 114 acres for the amusement park and other uses in addition to capital. Dollywood, a partnership of Ms. Parton and Norcross, Ga.-based Herschend Family Entertainment, will contribute capital and operate the park.

Dollywood operates the Dollywood complex and Dollywood’s Splash Country water park in eastern Tennessee. Among Herschend’s 26 amusement parks is Stone Mountain Park near Atlanta, where Herschend already has experience operating attractions with manmade snow.

“We’ve dreamed of different areas where we might have Dollywood II or III, but when this came along we thought it might be the perfect thing to do,” said Ms. Parton, who turned 66 on Thursday. “I was born and raised in Tennessee, and I’ve been in Nashville since 1964.”

For Nashville-based Gaylord, the Dollywood water park will be the third attached to one of its megahotels. The company opened a water park at its Gaylord Texan complex near Fort Worth, Texas, last year, and it is building one adjacent to its Gaylord Palms resort near Orlando.

The Nashville Dollywood, estimated to cost $50 million, is expected to include water rides, snow tubes for sledding and play areas where customers can build snowmen, among other attractions. “I can get out there and do some ice skating or something if I can find some skates with high heels,” Ms. Parton joked.

On a less jovial front, Gaylord this week disclosed that it is again fending off demands from its largest shareholder, Texas billionaire and rival hotelier Robert Rowling. It is likely this time that a compromise struck between the two will eliminate Gaylord’s takeover defenses later this year.

In a filing with the Securities and Exchange Commission this week, Gaylord reported that it reached a standstill agreement with Mr. Rowling’s TRT and his investment arm, Gamco Asset Management Inc., to add four directors to its board nominated by TRT and Gamco.

Other conditions of the agreement filed late Tuesday include Gaylord agreeing to allow its shareholders to vote this year on whether to end its “rights agreement,” which established several of the company’s takeover defenses, when it’s term ends Aug. 12. With TRT and Gamco controlling 21.3% and 12%, respectively, of Gaylord’s stock, the vote most likely will result in those defenses being removed.

In addition, Gaylord must invite TRT to bid in any process it begins prior to Aug. 12 to solicit a merger, joint venture or sale of the company.

Mr. Rowling’s ultimate goal in regard to Gaylord isn’t clear. A TRT representative declined to comment. Some analysts suspect he ultimately wants to add Gaylord’s four massive convention hotels to its Omni Hotels & Resorts portfolio.

“They’ve had their skirmishes with (Gaylord) management, but they haven’t sold” their Gaylord stock, said Jeff Donnelly, an analyst tracking the lodging industry for Wells Fargo. “I think their motivation is to ultimately have more control or influence over Gaylord, maybe outright ownership. They’ve been patient thus far.”

Indeed, Gaylord and Mr. Rowling struck a similar standstill agreement in the past. Mr. Rowling began amassing Gaylord stock in 2008, resulting in Gaylord enacting its takeover defenses. That included limiting ownership of Gaylord stock by any single investor to a 15% stake, later raised to 22%.

Fatal error: Uncaught Exception: 12: REST API is deprecated for versions v2.1 and higher (12) thrown in /home4/jdvc/public_html/wp-content/plugins/seo-facebook-comments/facebook/base_facebook.php on line 1273