Sunterra Acknowleges It Is in Discussions With Diamond Resorts

[Spence Super Moderator Find all posts View Profile Close Spence]

News Release

LAS VEGAS, NV, Mar 09, 2007 (MARKET WIRE via COMTEX News Network) -- Sunterra Corporation (PINKSHEETS: SNRR) today acknowledged, in response to a story issued by The Wall Street Journal, it is in discussions with Las Vegas-based Diamond Resorts, LLC regarding the possible acquisition of Sunterra, however, the company said it has not signed an agreement. There can be no assurance that any transaction will occur or, if undertaken, the terms or timing of such a transaction.
Sunterra said it will make no further comments at this time.

[riverdees05 Platinum Contributor Find all posts View Profile Close riverdees05]

Would this be a good thing for the US owners?

[Spence Super Moderator Find all posts View Profile Close Spence]

Would this be a good thing for the US owners?

I have no idea, but this is exactly what major stockholders want!

Sunterra says it may get offer

Sunterra Corp., a time-share vacation company, said closely held Diamond Resorts LLC of Las Vegas may make a takeover offer for it. Sunterra shares rose 26 percent. No agreement has been signed, Sunterra said Friday in a regulatory statement. Sunterra, which is based in North Las Vegas, said in December that it would restate some financial statements and delay filing its annual report because of accounting errors at its European subsidiary, which is for sale. Sunterra shares rose $3.10 to $14.95 in over-the-counter trading.

[dougp26364 Senior Member Find all posts View Profile Close dougp26364]

Would this be a good thing for the US owners?

As an owner at Polo Towers, a DRI managed resort, my opinion is NO. DRI has extremely poor communication skills and treats owners as a nuicense rather than owners.

[BocaBum99 Super Moderator Find all posts View Profile Close BocaBum99]

As an owner at Polo Towers, a DRI managed resort, my opinion is NO. DRI has extremely poor communication skills and treats owners as a nuicense rather than owners.

How does that compare to Sunterra? It may be a step up or a step down depending on how good they currently are.

[Ryne08 Senior Member Find all posts View Profile Close Ryne08]

I have no idea, but this is exactly what major stockholders want!

Does this buyer have the capital to purchase all of Sunterra resorts are they just a front for a major company?

Does anyone know the asking price for Sunterra?

The asking price is $325 million dollars according Steet Talk Home (Timeshare Beat).

[timeos2 Senior Member Find all posts View Profile Close timeos2]

They can't buy sold resorts

Does this buyer have the capital to purchase all of Sunterra resorts are they just a front for a major company?

Does anyone know the asking price for Sunterra?

They cannot "purchase the resorts" as the individual owners already did that. They can purchase the rights to new sales and maybe, depending on how agreements are constructed, the right to conversions to points. Unlike what Sheraton did to Vistana (now the Sheraton Vistana Resort) they can't even rename resorts without owners approval. They can get any management contracts Sunterra may hold, development and sales rights that are transferable. Given the rather tortured history of Sunterra exactly what they are buying and how that would affect owners may depend on where and what they own. In the little I've been able to find out about the suitor they don't sound very owner friendly. It will be interesting if t occurs.

[dougp26364 Senior Member Find all posts View Profile Close dougp26364]

How does that compare to Sunterra? It may be a step up or a step down depending on how good they currently are.

If Sunterra owners want management that communicates with owners, maintains it's resorts to the highest standards without the need of big SA's, looks out for it's owners rather than taking advantage of them and is generally responsive to owners, or a management compnay that gets things done when they say they will, then, IMO they won't be getting that with DRI.

[Ryne08 Senior Member Find all posts View Profile Close Ryne08]

Maybe DRI, would give management control to someone like VRI.

[Carolinian Super Moderator Find all posts View Profile Close Carolinian]

Their points program may give the buyer effective control of many of the HOA's. The buyer will certainly end up with its nominees in control of the points trust, and voting the block of votes associated with the trust may give them a controlling interest. This allows them to put whatever management they want in, allows them to rename resorts, etc.

Hopefully, Club La Costa will at least get the European resorts. While I hear mixed reviews of their management, at least their close ties with DAE could put DAE with increased access to inventory in Europe.

Does anyone know DRI's connections in the exchange world?

Also for the benefit of Sunterra owners, is DRI a control freak when it comes to running resorts and their HOA's?

[dougp26364 Senior Member Find all posts View Profile Close dougp26364]

Their points program may give the buyer effective control of many of the HOA's. The buyer will certainly end up with its nominees in control of the points trust, and voting the block of votes associated with the trust may give them a controlling interest. This allows them to put whatever management they want in, allows them to rename resorts, etc.

Hopefully, Club La Costa will at least get the European resorts. While I hear mixed reviews of their management, at least their close ties with DAE could put DAE with increased access to inventory in Europe.

Does anyone know DRI's connections in the exchange world?

Also for the benefit of Sunterra owners, is DRI a control freak when it comes to running resorts and their HOA's?

DRI is associated with I.I.

Yes, I'd say they're a control freak with HOA's and running the resorts. I have yet to see an outsider sit on either the HOA or BOD at Polo Towers. DRI certainly has control and not the owners. They have a habit of not getting ballots to all the owners and then never announcing the results of the voting. Things just go along as they always have.

This may be a good thing for Polo Towers owners. I assume it will give us internal exchanging options to Sunterra resorts. DRI had made promises to expand and become a player in the timeshare world. Then they all but got out of the timeshare business after buying something like 23 units at Kona Reef. Any expansion plans they might have had were just dropped. That is until now.

I don't know what's up Stephen Cloobecks sleeve but as an owner of two weeks at Polo Towers, I've learned not to trust him as far as looking out for the owners. Perhaps he's seen how Mr. Seagull is living off his timeshare empire.

[timeos2 Senior Member Find all posts View Profile Close timeos2]

If you own Sunterra keep an eye on this

Their points program may give the buyer effective control of many of the HOA's. The buyer will certainly end up with its nominees in control of the points trust, and voting the block of votes associated with the trust may give them a controlling interest. This allows them to put whatever management they want in, allows them to rename resorts, etc.

Hopefully, Club La Costa will at least get the European resorts. While I hear mixed reviews of their management, at least their close ties with DAE could put DAE with increased access to inventory in Europe.

Does anyone know DRI's connections in the exchange world?

Also for the benefit of Sunterra owners, is DRI a control freak when it comes to running resorts and their HOA's?

For once Steve and I may be in complete agreement. The potential for serious problems for owners of Sunterra controlled resorts and the various Club Sunterra iterations are great. As Steve mentioned if Sunterra holds the control of the Board at your resort this could be a disaster. If you belong to one of the Club Sunterra systems a new owner could make changes that aren't in your best interest. From the antidote's we're seeing posted it doesn't sound like the operation and management of DRI is a step up from the already variable levels of Sunterra.

As a Sunterra owner I'd be very nervous and double checking my options. Of course given Sunterra's history this is no surprise and anyone that bought in should have contingency plans ready for the day that they were bought out or absorbed into another timeshare group. I know that I'm very glad that I didn't give up my deeded ownership at my Sunterra affiliated resort and that I have done everything possible to minimize the impact of any change at Sunterra on that resort. Now all we can do is wait and see. I am very worried about the resorts that remain under Sunterra management and/or they still control the Board. History says owners lose in those situations.

[Ryne08 Senior Member Find all posts View Profile Close Ryne08]

A few years ago then Cendant (now Wynham) wanted to purchase Sunterra are they still interested in a Sunterra deal?

[dougp26364 Senior Member Find all posts View Profile Close dougp26364]

For once Steve and I may be in complete agreement. The potential for serious problems for owners of Sunterra controlled resorts and the various Club Sunterra iterations are great. As Steve mentioned if Sunterra holds the control of the Board at your resort this could be a disaster. If you belong to one of the Club Sunterra systems a new owner could make changes that aren't in your best interest. From the antidote's we're seeing posted it doesn't sound like the operation and management of DRI is a step up from the already variable levels of Sunterra.

As a Sunterra owner I'd be very nervous and double checking my options. Of course given Sunterra's history this is no surprise and anyone that bought in should have contingency plans ready for the day that they were bought out or absorbed into another timeshare group. I know that I'm very glad that I didn't give up my deeded ownership at my Sunterra affiliated resort and that I have done everything possible to minimize the impact of any change at Sunterra on that resort. Now all we can do is wait and see. I am very worried about the resorts that remain under Sunterra management and/or they still control the Board. History says owners lose in those situations.

Keep in mind what I'm posting is just my opinion. We own at HGVC, Marriott and Spinnaker managed resorts so that's my base of comparison for how PT's is managed.

Right now we have an unpgrade to be paid for with a rather large SA (over $1,000 for 2 bedroom owners). They had to keep extending the vote to get a quorum, they did not communicate with owners how things were going, owners who had already voted were ask to vote again (they didn't have a record of their vote), some owners reported difficulty getting their vote in, et..... Now they have set two different start/finish dates. I have an E-mail stating the renovation were to be started this month (March of '07). Another poster has an E-mail stating renovations are to start in June of '07. The last SA to convert the tennis courts to a family water park took several years (3 I believe). The 18th floor owners lounge was converted to office space without letting the owners know what was happening or even that it had happened. And the list could go on.

Now the staff has always been great and problems have always been taken care of quickly when we've stayed there. It's just that the HOA/BOD doesn't seem to give a rats back sides about communicating with the owners or getting things done in a timely manner. We've owned since '98 and at this point the lack of communication is very irritating.

The odd thing is I'm sitting here typing this right now and I'm I actually have Polo Towers as my background. I'm sitting in a one bedroom Marriott's Grand Chateau unit that overlooks Polo Towers. Polo Towers really does have a great location on the strip. So I guess I really have a love/hate relationship going on with this particular timeshare and it's management.

[opkansas Senior Member Find all posts View Profile Close opkansas]

Maybe DRI, would give management control to someone like VRI.

GOD FORBID!