Starwood Hotels & Resorts Worldwide, Inc. Announces Closing of Sale of Hotel Portfolio to Host
WHITE PLAINS, N.Y. | Starwood Hotels & Resorts Worldwide, Inc. (NYSE: HOT) ("Starwood") announced today that it has closed on a sale of 28 hotels - including hotels under the Sheraton, W, Westin, St. Regis and Luxury Collection brands - to Host Marriott Corporation (NYSE: HMT) ("Host"). The hotels will remain in the Starwood system and continue to be managed by Starwood under long-term management agreements.
WHITE PLAINS, N.Y. | Starwood Hotels & Resorts Worldwide, Inc. (NYSE: HOT) ("Starwood") announced today that it has closed on a sale of 28 hotels - including hotels under the Sheraton, W, Westin, St. Regis and Luxury Collection brands - to Host Marriott Corporation (NYSE: HMT) ("Host"). The hotels will remain in the Starwood system and continue to be managed by Starwood under long-term management agreements.
The total value of the transaction for the 35 hotels in the entire portfolio (including cash, stock, and the assumption of debt) is approximately $4.23 billion. Starwood shareholders have directly received $2.8 billion or 66% of the proceeds in the form of Host stock valued at $2.68 billion based on Host's $20.53 closing price on Friday, April 07, 2006, and $119 million in cash. Starwood has received approximately $738 million today, $600 million in cash, $77 million in the form of property level debt which Host has assumed and $61 million in Host stock. The remaining proceeds relate to seven hotels in Europe and Asia, where the closing has been deferred as a result of certain notice periods and consents that have not yet lapsed or been received. These proceeds will be received by Starwood in the form of $661 million in cash and $31 million in the form of property level debt which Host will assume when those sales are closed. As provided for in the merger agreement, Starwood previously elected to remove 3 Canadian hotels from the original portfolio and reduced the cash portion of the transaction by approximately $276 million, because Starwood was unable to receive a favorable tax ruling.
"We are very pleased that we have completed the sale of these hotels to Host at an attractive price and were able to return 66% of the proceeds directly back to our shareholders," said Steven J. Heyer, Starwood Chief Executive Officer. "We have entered into great, long-term management contracts on these hotels with an excellent partner. This transaction represents a major milestone as we evolve our business to balance asset ownership with our fee based business, while continuing to drive growth in our vacation ownership business. We have created a higher growth, more capital efficient and less cyclical business with tremendous balance sheet flexibility to fund growth and return additional value to our shareholders."
Portfolio of hotels North America ---------------------------------------------------------------------- Sheraton Location # of Rooms ---------------------------------------------------------------------- Sheraton San Diego Hotel & Marina San Diego, CA 1,044 ---------------------------------------------------------------------- Sheraton Boston Hotel Boston, MA 1,216 ---------------------------------------------------------------------- Sheraton New York Hotel & Towers New York, NY 1,746 ---------------------------------------------------------------------- Sheraton Hotel Parsippany Parsippany, NJ 370 ---------------------------------------------------------------------- Sheraton Indianapolis Indianapolis, IN 560 ---------------------------------------------------------------------- Sheraton Needham Hotel Needham, MA 247 ---------------------------------------------------------------------- Sheraton Stamford Hotel Stamford, CT 448 ---------------------------------------------------------------------- Sheraton Providence Airport Hotel Providence, RI 206 ---------------------------------------------------------------------- Sheraton Suites Tampa Airport Tampa, FL 259 ---------------------------------------------------------------------- Sheraton Hotel Braintree Braintree, MA 374 ---------------------------------------------------------------------- Sheraton Milwaukee Brookfield Hotel Brookfield, WI 389 ---------------------------------------------------------------------- Sheraton Tucson Hotel & Suites Tucson, AZ 216 ---------------------------------------------------------------------- Westin Location # of Rooms ---------------------------------------------------------------------- Westin Grand, D.C. Washington D.C. 263 ---------------------------------------------------------------------- Westin Indianapolis Indianapolis, IN 573 ---------------------------------------------------------------------- Westin Seattle Seattle, WA 891 ---------------------------------------------------------------------- Westin Waltham Boston Boston, MA 346 ---------------------------------------------------------------------- Westin Mission Hills Resort Rancho Mirage, CA 512 ---------------------------------------------------------------------- Westin Tabor Center Denver, CO 430 ---------------------------------------------------------------------- Westin Cincinnati Cincinnati, OH 456 ---------------------------------------------------------------------- Westin Los Angeles Airport Los Angeles, CA 740 ---------------------------------------------------------------------- Westin South Coast Plaza Costa Mesa, CA 390 ---------------------------------------------------------------------- W Location # of Rooms ---------------------------------------------------------------------- W New York New York, NY 688 ---------------------------------------------------------------------- W Seattle Seattle, WA 426 ---------------------------------------------------------------------- St. Regis Location # of Rooms ---------------------------------------------------------------------- St. Regis Houston Houston, TX 232 ---------------------------------------------------------------------- Other Location # of Rooms ---------------------------------------------------------------------- Capitol Hill Suites Washington D.C. 152 ---------------------------------------------------------------------- International ---------------------------------------------------------------------- Sheraton Location # of Rooms ---------------------------------------------------------------------- *Sheraton Skyline Hotel & CC London, U.K. 350 ---------------------------------------------------------------------- Sheraton Warsaw Hotel & Towers Warsaw, Poland 350 ---------------------------------------------------------------------- *Sheraton Roma Hotel & CC Rome, Italy 634 ---------------------------------------------------------------------- Sheraton Santiago Hotel & CC Santiago, Chile 379 ---------------------------------------------------------------------- *Sheraton Fiji Resort Nadi, Fiji 281 ---------------------------------------------------------------------- Westin Location # of Rooms ---------------------------------------------------------------------- *Westin Palace Madrid Madrid, Spain 468 ---------------------------------------------------------------------- *Westin Palace Milan Milan, Italy 228 ---------------------------------------------------------------------- *Westin Europa & Regina Venice, Italy 185 ---------------------------------------------------------------------- *Westin Royal Denarau Resort Nadi, Fiji 273 ---------------------------------------------------------------------- Luxury Collection Location # of Rooms ---------------------------------------------------------------------- San Cristobal Tower Santiago, Chile 139 ----------------------------------------------------------------------