Interstate Hotels & Resorts Agrees to be Acquired by Joint Venture Between Thayer Lodging Group and Jin Jiang Hotels
|
|
Interstate Hotels & Resorts Agrees to be Acquired by Joint Venture Between Thayer Lodging Group and Jin Jiang Hotels
|
Category: Worldwide - Industry economy
- New brands / Affiliations
This is a press release selected by our editorial committee and published online for free on 2009-12-21
Interstate Hotels & Resorts (NYSE: IHR), a leading hotel real estate investor and the nation's largest independent hotel management company, today announced that it has signed a definitive merger agreement to be acquired by Hotel Acquisition Company, LLC, a 50/50 joint venture between subsidiaries of Thayer Hotel Investors V-A LP, a private equity fund sponsored by Thayer Lodging Group, and Shanghai Jin Jiang International Hotels (Group) Company Limited ("Jin Jiang Hotels") in a transaction valued at approximately $307 million. Under the agreement, Hotel Acquisition Company, LLC would acquire all of the outstanding common stock and operating partnership units of Interstate for $2.25 per share in an all cash transaction. The price represents a premium of 77 percent over yesterday's closing stock price. Interstate's lenders have approved the transaction subject to certain pay downs at closing on its senior credit facility and on one of its non-recourse mortgage loans. The transaction is not contingent upon obtaining any additional financing.
Annapolis, Md.-based Thayer Lodging Group is a privately held real estate investment company focused on hospitality assets; Shanghai, China based Jin Jiang Hotels is a subsidiary of Jin Jiang International Holdings Company Limited, and is China's largest hotel group.
Interstate's board of directors has unanimously approved the merger agreement and has recommended approval of the transaction by Interstate's stockholders. Stockholders will be asked to vote on the proposed transaction at a special meeting that will be held on a date to be announced. The merger is expected to close in the first quarter of 2010, pending stockholder approval and satisfaction or waiver of other customary closing conditions.
"Our priority, as always, is to maximize shareholder value," said Thomas F. Hewitt, Interstate's chairman and chief executive officer. "This is a very compelling offer at a significant premium. The hotel industry remains in deep recession, and we believe this transaction offers the highest and best value to our shareholders."
"Interstate offers a unique platform with in-depth industry expertise, international operations, and scope of experience gained over 50 years, along with a stellar reputation as a first-rate operator," said Leland C. Pillsbury, chief executive officer and co-chairman, Thayer Lodging Group. Frederic V. Malek, Thayer's co-chairman added, "We look forward to working with Interstate's management team and associates, their owners and partners as we build on the company's impressive legacy of success."
"Interstate has a global reputation as a world-class, independent hotel operator. This acquisition significantly accelerates our ability to expand internationally, giving us immediate access to a worldwide platform. We also expect to mutually benefit from our global relationships in the hospitality industry, making both Jin Jiang and Interstate stronger," said Mr. Yu Minliang, Jin Jiang Hotels' Chairman.
Barclays Capital served as financial advisor to Interstate, BofA Merrill Lynch served as financial advisor to Thayer, and UBS Investment Bank served as financial advisor to Jin Jiang Hotels. Paul Weiss, Rifkind, Wharton & Garrison LLP served as legal advisor for Interstate. Hogan & Hartson LLP served as Thayer's legal advisor and Baker & McKenzie LLP served as Jin Jiang Hotels' legal advisor.
|
|
