A potential combination for Temple Hotels

I have written several articles on combination theory.A combination is a mini-merger.A small number of shares(from 5 to 25%) can be purchased which gives the acquiring company a chance to train or apprentice as the owner of the smaller company.I have ,in an earlier blog, on both Wordpress and Tumblr discussed the possibility of Temple Hotels starting a combination with Lanesboro REIT.Both are reits and both own properties in the Canadian north.In particular, properties in Fort Macmurray.
  Needs and Resources
  Lanesboro has only $5 million left in  it's revolving loan credit facility.It has refinanced it's mortgage loans at better interest rates but there is no more financing capacity left on their mortgages.Lanesboro has stated that it intends to sell another property before the end of the year but does not state the location.It also had a small operating loss in the last quarter.However it still has about $125 million in shareholder equity and $475 million in assets.Temple Hotels (TPH) has hotels in Fort Macmurray and hotels throughout Canada but it only has hotels. Lanesboro (LRT) has extended stay properties and senior residences.Both have properties in Fort Macmurray and both are affected by the drop in occupancy rates.There is getting to be more competition especially for hotels.But the occupancy rate has stabilized.It was about 90% in 2013 and fell to 86% and then 80% in Q1 2014.Now it is back to 89%.However both TPH and LRT want an occupancy rate of 96 to 98%.
  LRT needs some cash to renovate  their big project called Parson's Landing.Quite a few suites have been renovated but it is still only 94 % complete.LRT will be strapped for cash as it has only $5 million left on it's credit facility. On the  other hand, TPH made $15 million Operating Income for 9 months and has about $15 million cash on hand.This is a chance for a combination.TPH also has only 69% of it's assets in debt and could increase one of it's convertible debt issues;it has four series and lots of debt capacity left.
The  Proposal
   Right now Lanesboro shares are trading at about $.80 per share.TPH could buy 8 million shares for about $8 million.This would give it less than 35% as the price would go up for a  large block but it would probably give it 50 to 65% and the start of a combination.TPH might sell off an older property that it has lots of equity in and has lower occupancy rates.This would give it higher occupancy rates overall and the cash necessary to help it's 30%  owned partner to improve Parson's Landing.Some renovations to other Fort Macmurray properties might raise the occupancy rates on both TPH and LRT properties.Higher occupancy rates on the "Fort" properties  would have great impact on profit margins for Temple Hotels and it's 65% owned partner.This combination stage would give both partners a chance to improve operations and margins and see if they want to go further.