La Quinta Announces Agreement to be Acquired by The Blackstone Group
November 09 2005 - 8:19AM
PR Newswire (US)
DALLAS, Nov. 9 /PRNewswire-FirstCall/ -- La Quinta Corporation and
La Quinta Properties, Inc. (NYSE:LQI) today announced that they
have entered into a definitive merger agreement to be acquired by
an affiliate of The Blackstone Group for $11.25 per paired share in
cash. The price represents a premium of 37% over yesterday's
closing price of $8.22. The total value of the transaction,
including debt, is approximately $3.4 billion. The boards of
directors of La Quinta unanimously approved the merger agreement
and recommended approval by their stockholders. La Quinta
Corporation 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 completion of the merger agreement is subject to
various customary closing conditions. The closing of the merger
agreement is expected to occur during the first quarter of 2006.
Completion of the merger agreement is not subject to the receipt of
financing by Blackstone. Francis W. ("Butch") Cash, chairman and
chief executive officer for La Quinta, said, "We are pleased to
have signed a merger agreement with one of the world's preeminent
owners of hotels and resorts. Blackstone was attracted by our
strong brands, high quality hotels, excellent management team and
operating culture that is focused on delivering superior guest
satisfaction. We believe this transaction is beneficial to our
stockholders and will build on the accomplishments we have achieved
over the last five years." Jonathan D. Gray, senior managing
director of The Blackstone Group, said, "We are excited to be
acquiring La Quinta and look forward to working with its employees
and franchise owners to continue the company's success. We feel
particularly fortunate to inherit such a great organization and
vibrant franchisee base." Morgan Stanley acted as financial advisor
to La Quinta. Bear Stearns, Deutsche Bank, and Merrill Lynch acted
as financial advisors to Blackstone. Acquisition financing is being
provided by Bank of America, Bear Stearns, and Merrill Lynch.
Goodwin Procter LLP acted as legal advisor to La Quinta. Simpson
Thacher & Bartlett LLP acted as legal advisor to Blackstone.
About La Quinta La Quinta Corporation and its controlled
subsidiary, La Quinta Properties, Inc. (NYSE:LQI) is one of the
largest owner/operators of limited-service hotels in the United
States. Based in Dallas, Texas, the Company owns and operates 360
hotels and franchises more than 240 hotels in 39 states under the
La Quinta Inns(R), La Quinta Inn & Suites(R), Baymont Inn &
Suites(R), Woodfield Suites(R) and Budgetel(R) brands. For more
information about La Quinta Corporation, please visit
http://www.lq.com/. About The Blackstone Group The Blackstone
Group, a private investment firm with offices in New York, Atlanta,
Boston, Los Angeles, London, Hamburg, Mumbai and Paris, was founded
in 1985. Blackstone's Real Estate Group has raised six funds,
representing over $8 billion in total equity and has a long track
record of investing in hotels and other commercial properties. In
addition to real estate, The Blackstone Group's core businesses
include private equity investing, corporate debt investing,
distressed debt securities, marketable alternative asset
management, corporate advisory services and restructuring and
reorganization advisory. For more information about The Blackstone
Group, please visit http://www.blackstone.com/. Safe Harbor
Statement Certain matters discussed in this press release may
constitute "forward- looking statements" within the meaning of
Section 27A of the Securities Act of 1933, Section 21E of the
Securities Exchange Act of 1934 and the Private Securities
Litigation Reform Act of 1995. Words such as "believes,"
"anticipates," "expects," "intends," "estimates," "projects" and
other similar expressions, which are predictions of or indicate
future events and trends, typically identify forward-looking
statements. Our forward-looking statements are subject to a number
of risks and uncertainties, which could cause actual results or the
timing of events to differ materially from those described in the
forward-looking statements. Accordingly, we cannot assure you that
the expectations set forth in these forward-looking statements will
be attained. We may not be able to complete the proposed
transaction on the terms summarized above or other acceptable
terms, or at all, due to a number of factors, including the failure
to obtain approval of our stockholders, regulatory approvals or to
satisfy other customary closing conditions. Some of the factors
that could cause our actual results or the timing of certain events
to differ from those described in these forward-looking statements
include, without limitation, our ability to successfully grow
revenues (through our revenue initiatives, including our
franchising programs, our internet distribution initiatives and our
customer loyalty programs, or otherwise) and profitability of our
lodging business and franchising programs; concentration of our
properties in certain geographic areas; our ability to realize
sustained labor or other cost savings; the availability and costs
of insurance for our properties and business; competition within
the lodging industry, including in the franchising of the La Quinta
and Baymont brands; our ability to generate attractive rates of
return on new lodging investments; the cyclicality of the lodging
business; the impact of U.S. military action abroad and/or
additional terrorist activities; the effects of a general economic
slowdown, including decreases in consumer confidence and business
spending, which may adversely affect our business and industry;
interest rates; the ultimate outcome of litigation filed against
us; the availability of capital for corporate purposes including
for debt repayment, acquisitions and capital expenditures; the
conditions of the capital markets in general; acquisition-related
risks; and other risks detailed from time to time in our filings
with the Securities and Exchange Commission, including, without
limitation, the risks described in our Joint Annual Report on Form
10-K filed with the Securities and Exchange Commission on March 15,
2005, in the section entitled "Certain Factors You Should Consider
About Our Companies, Our Businesses and Our Securities," as updated
by our Joint Current Report on Form 8-K filed with the SEC on May
27, 2005. We undertake no obligation to publicly update or revise
any forward-looking statements, whether as a result of new
information, future events or other changes. This communication is
being made in respect of the proposed merger transaction involving
La Quinta and Blackstone. In connection with the proposed
transaction, La Quinta will file a proxy statement for the
stockholders of La Quinta describing the merger transaction. La
Quinta will be filing other documents with the Securities and
Exchange Commission as well. Before making any voting or investment
decision, investors are urged to read the proxy statement regarding
the proposed transaction and any other relevant documents carefully
in their entirety when they become available because they will
contain important information about the proposed transaction. The
final proxy statement will be mailed to La Quinta's stockholders.
The proxy statement and other documents will be available free of
charge at the SEC's internet site (http://www.sec.gov/). The proxy
statement (when it is available) and the other documents may also
be obtained for free by accessing La Quinta's website at
http://www.lq.com/. La Quinta and its directors and officers and
other members of management and employees may be deemed to be
participants in the solicitation of proxies in respect of the
proposed merger transaction. Information regarding La Quinta's
directors and executive officers is set forth in La Quinta's proxy
statements and annual reports on form 10-K, previously filed with
the SEC, and the proxy statement relating to the merger when it
becomes available. DATASOURCE: La Quinta Corporation CONTACT:
Investor Relations: Tom Ward, +1-214-492-6689, Public Relations:
Teresa Ferguson, +1-214-492-6937 Web site: http://www.lq.com/
http://www.blackstone.com/
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