MeriStar Hospitality to Sell 10 Florida Assets
01 Febrero 2006 - 6:00AM
PR Newswire (US)
BETHESDA, Md., Feb. 1 /PRNewswire-FirstCall/ -- MeriStar
Hospitality Corporation (NYSE:MHX), one of the nation's largest
hotel real estate investment trusts (REIT), today announced that it
has signed a definitive agreement to sell a portfolio of nine
hotels (1,948 rooms) and a golf and tennis club, all located in
Florida, to an affiliate of The Blackstone Group for approximately
$367 million in cash, subject to certain adjustments and
satisfaction of customary closing conditions. The company expects
the transaction to close by the end of the first quarter 2006. The
company intends to use the majority of the proceeds to further
reduce debt, particularly its most expensive 10.5 percent senior
unsecured debt, which currently is callable by the company. The
properties to be sold include: -- Best Western Sanibel Island Beach
Resort (46 rooms) -- The Dunes Golf & Tennis Club -- Hilton
Cocoa Beach Oceanfront (296 rooms) -- Hilton Clearwater Beach
Resort (426 rooms) -- Sanibel Inn (96 rooms) -- Seaside Inn (32
rooms) -- Sheraton Beach Resort Key Largo (200 rooms) -- Song of
the Sea (30 rooms) -- South Seas Island Resort (579 rooms) --
Sundial Beach Resort (243 rooms) "We expect this portfolio sale to
generate significant benefits for our shareholders by allowing us
to accelerate our business plan objectives of repaying our more
expensive debt and completing property upgrades," said Paul
Whetsell, chairman and CEO. "Furthermore, with the closing of this
transaction, our asset disposition program will be nearly complete.
As a result of this transaction we will have significantly greater
financial flexibility and greater visibility on the timing of
restoring a regular cash dividend to our common shareholders. We
are pleased to be able to take advantage of the strong real estate
market in Florida and unlock the substantial values in these assets
for our shareholders." The sales price reflects an EBITDA multiple
for the 10 properties that is accretive to the company's current
trading value. Bethesda, Md.-based MeriStar Hospitality Corporation
owns 58 principally upper-upscale, full-service hotels in major
markets and resort locations with 17,003 rooms in 19 states and the
District of Columbia. The company owns hotels under such
internationally known brands as Hilton, Sheraton, Marriott,
Ritz-Carlton, Westin, Doubletree and Radisson. For more information
about MeriStar Hospitality, visit the company's website:
http://www.meristar.com/. This press release contains
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934. Forward-looking statements, which are based on various
assumptions and describe our future plans, strategies and
expectations, are generally identified by our use of words such as
"intend," "plan," "may," "should," "will," "project," "estimate,"
"anticipate," "believe," "expect," "continue," "potential,"
"opportunity," and similar expressions, whether in the negative or
affirmative. We cannot guarantee that we actually will achieve
these plans, intentions or expectations. All statements regarding
our expected financial position, business and financing plans are
forward- looking statements. Except for historical information,
matters discussed in this press release are subject to known and
unknown risks, uncertainties and other factors which may cause our
actual results, performance or achievements to be materially
different from future results, performance or achievements
expressed or implied by such forward-looking statements. Factors
which could have a material adverse effect on our operations and
future prospects include, but are not limited to: economic
conditions generally and the real estate market specifically;
supply and demand for hotel rooms in our current and proposed
market areas; other factors that may influence the travel industry,
including health, safety and economic factors; competition; the
level of proceeds from asset sales; cash flow generally, including
the availability of capital generally, cash available for capital
expenditures, and our ability to refinance debt; the effects of
threats of terrorism and increased security precautions on travel
patterns and demand for hotels; the threatened or actual outbreak
of hostilities and international political instability;
governmental actions, including new laws and regulations and
particularly changes to laws governing the taxation of real estate
investment trusts; weather conditions generally and natural
disasters; rising insurance premiums; rising interest rates; and
changes in U.S. generally accepted accounting principles, policies
and guidelines applicable to real estate investment trusts. These
risks and uncertainties should be considered in evaluating any
forward-looking statements contained in this press release or
incorporated by reference herein. All forward-looking statements
speak only as of the date of this press release or, in the case of
any document incorporated by reference, the date of that document.
All subsequent written and oral forward-looking statements
attributable to us or any person acting on our behalf are qualified
by the cautionary statements in this section. We undertake no
obligation to update or publicly release any revisions to
forward-looking statements to reflect events, circumstances or
changes in expectations after the date of this press release.
Contact: Mike Bauer Sr. Director, Finance and Investor Relations
(301) 581-5927 Jerry Daly or Carol McCune Daly Gray Public
Relations (Media) (703) 435-6293 First Call Analyst: FCMN Contact:
julie@dalygray.com DATASOURCE: MeriStar Hospitality Corporation
CONTACT: Mike Bauer, Sr. Director, Finance and Investor Relations
of MeriStar, +1-301-581-5927; Jerry Daly or Carol McCune both of
Daly Gray Public Relations (Media), +1-703-435-6293 Web site:
http://www.meristar.com/
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