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Hotel Industry News |
Sunday July 6th, 2008 |
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MeriStar Hospitality and The Blackstone Group to Merge - $2.6 Billion Transaction |
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MeriStar Hospitality Corporation (NYSE:MHX) , one of the nation's largest hotel real estate investment trusts (REIT), today announced that it has signed a merger agreement to be acquired by an affiliate of The Blackstone Group in a transaction valued at approximately $2.6 billion. |
In the mergers contemplated by the merger agreement, each share of MeriStar common stock and each unit of limited partnership interest in MeriStar Hospitality Operating Partnership, L.P., MeriStar's operating partnership, will be converted into the right to receive $10.45 in cash. The $10.45 per-share consideration represents a 20 percent premium over MeriStar's closing stock price on November 10, 2005, the date prior to published reports regarding a potential acquisition of MeriStar.
The board of directors of MeriStar has unanimously approved the merger agreement and has recommended the approval of the transactions by MeriStar's stockholders. Stockholders will be asked to vote on the proposed transactions at a special meeting that will be held on a date to be announced. The mergers are expected to close in the second quarter of 2006, pending stockholder approval and other customary closing conditions. Completion of the mergers is not subject to receipt of financing by Blackstone.
"We are pleased to have entered into this agreement and believe that the transaction represents attractive value to our shareholders," said Paul Whetsell, MeriStar's chairman and CEO.
Jonathan D. Gray, senior managing director of The Blackstone Group, said "We are excited to acquire the company. We look forward to working with MeriStar's franchisors, managers and partners."
MeriStar remains on track to close its previously announced sale of nine hotels and one golf and tennis club to affiliates of The Blackstone Group during the first quarter 2006.
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