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Friday, December 18, 2009 11:41:49 AM
ARLINGTON, Va., Dec. 18 /PRNewswire-FirstCall/ -- 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
About Thayer Lodging Group
Thayer Lodging Group is a sponsor of real estate investment funds with a track record in the top 5% of all fund sponsors for the past 19 years. Its clients include a select group of large, international institutional investors, the majority of which have been investors with Thayer for most of its 19-year history. The company is a value-add investor that works with major lodging brands to acquire and reposition hotels. Thayer sold $1.7 billion of hotels and resorts, which represented 85% of its real estate portfolio in 2006-2007, and retained a small group of 15 properties, which have been recently renovated and repositioned. It recently announced the closing of its fifth investment fund, Thayer Hotel Investors V LP, and its parallel fund, V-A LP, together totaling $280 million. Additionally, Thayer Lodging Group recently placed another $100 million under management in a separate vehicle. More information about the company can be found on its website: http://www.thayerlodging.com/
About Jin Jiang Hotels
Shanghai Jin Jiang International Hotels (Group) Company Limited is one of the leading hotel operators and managers in China. The Group is licensed to use the well-regarded "Jin Jiang" and "Jin Jiang Inn" brands. As of 30 June 2009, the Group operated and was developing 493 hotels including star-rated hotels and Jin Jiang Inn budget hotels, providing close to 82,700 rooms in aggregate. With a solid home base in Shanghai and Beijing, the Group has also successfully spanned its hotel network across 124 cities and towns in 31 provinces, autonomous regions and municipalities throughout the PRC. In June 2009, the Group was ranked the 13th in the world in terms of number of rooms according to HOTELS Magazine, the official publication of the International Hotel & Restaurant Association. For information about Jin Jiang Hotels, visit the company's website: http://www.jinjianghotels.com.cn/
About Interstate Hotels & Resorts
Interstate Hotels & Resorts, Inc. and its affiliates manages and/or has ownership interests in a total of 232 hospitality properties with more than 46,000 rooms in 37 states, the District of Columbia, Russia, India, Mexico, Belgium, Canada, Ireland and England. The company has ownership interests in 56 of those properties, including six wholly owned assets. Interstate Hotels & Resorts also has contracts to manage 13 to be built hospitality properties with approximately 3,000 rooms which includes the company's entry into new markets such as Costa Rica. For more information about Interstate Hotels & Resorts, visit the company's Web site: http://www.ihrco.com/
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