Affiliates of Blackstone Real Estate Partners VIII L.P. agreed to buy Strategic Hotels & Resorts for $6 billion, including all outstanding debt and outstanding shares of stock for $14.25 per share in cash.
“Our board and management team have consistently stated that we would consider any opportunity that maximizes stockholder value,” says Raymond L. “Rip” Gellein, chairman and CEO of Strategic Hotels & Resorts. “We believe this transaction capitalizes on our unique portfolio, strong asset-management platform, and continued operating outperformance over the past several years. The board thoroughly considered various alternatives over the course of the past few years, and this all cash offer from Blackstone creates significant stockholder value with a high degree of execution certainty.”
“We are excited about the opportunity to acquire one of the highest quality luxury hotel portfolios in the U.S.,” says Tyler Henritze, co-head of U.S. acquisitions for Blackstone Real Estate. “As long-term investors in the lodging industry, we remain confident in the fundamentals of the sector despite recent market volatility.”
The offer price represents a premium of approximately 13 percent over the unaffected intra-day trading price on July 23rd, when the sale of Strategic was reported. On August 17th, the company confirmed that its board of directors had retained J.P. Morgan and was exploring possible strategic alternatives, including a potential sale.
