LaSalle Hotel Properties (NYSE:LHO) (“LaSalle” or the “Company”)
today announced that it has entered into a definitive agreement
with affiliates of Blackstone Real Estate Partners VIII, under
which Blackstone, a leading global asset manager, will acquire all
outstanding common shares of beneficial interest of LaSalle for
$33.50 per share in an all-cash transaction valued at $4.8
billion.
The transaction, which has been unanimously approved by
LaSalle's Board of Trustees (the “Board”), represents a premium of
approximately 35 percent over LaSalle's unaffected share price of
$24.84 as of March 27, 2018, the day before the public announcement
of a proposal to acquire the Company in an all-stock transaction.
The purchase price also represents a premium of approximately 13
percent to LaSalle’s consensus net asset value (“NAV”) of $29.64
per share per FactSet as of May 18, 2018.
“We are pleased to have reached this agreement with Blackstone,
which we believe is in the best interests of our shareholders and
represents the culmination of a thorough review of strategic
alternatives,” said Stuart L. Scott, Chairman of the Board of
LaSalle. “As part of the Board’s review, the Company and its
advisors contacted 20 potential buyers, including strategic
parties, brands and private equity firms. As a result, 10 potential
buyers executed confidentiality agreements and received non-public
information, and the Board engaged in extensive negotiations over
price and terms. After careful consideration of multiple proposals
received, the Board determined that this transaction represents the
most compelling opportunity for LaSalle’s shareholders, delivering
a significant premium with immediate and certain cash value.”
Michael D. Barnello, President and Chief Executive Officer of
LaSalle said, “After a robust and competitive process, we are
pleased to enter into this transaction with Blackstone, which has a
proven ability to complete large transactions on agreed terms and
has extensive experience in the real estate industry.”
Tyler Henritze, head of US real estate acquisitions for
Blackstone, added, “We are thrilled to acquire LaSalle and have the
opportunity to invest in its high-quality urban hotel
portfolio.”
Completion of the transaction, which is expected to occur in the
third quarter of 2018, is contingent upon customary closing
conditions, including the approval of LaSalle’s shareholders. The
transaction is not contingent on receipt of financing.
Pursuant to LaSalle’s previously announced dividend policy, the
Company expects to pay a quarterly dividend of $0.225 per common
share of beneficial interest for the quarter ending June 30,
2018.
Advisors
Citigroup Global Markets Inc. and Goldman Sachs & Co. LLC
are acting as financial advisors to LaSalle and Goodwin Procter LLP
and DLA Piper LLP (US) are acting as legal counsel.
Morgan Stanley & Co. LLC and J.P. Morgan are acting as
financial advisors and Eastdil Secured LLC is acting as real estate
advisor to Blackstone. Simpson Thacher & Bartlett LLP is acting
as legal advisor to Blackstone.
About LaSalle Hotel Properties
LaSalle Hotel Properties is a leading multi-operator real estate
investment trust. The Company owns 41 properties, which are
upscale, full-service hotels, totaling approximately 10,400 guest
rooms in 11 markets in seven states and the District of Columbia.
The Company focuses on owning, redeveloping and repositioning
upscale, full service hotels located in urban, resort and
convention markets. LaSalle Hotel Properties seeks to grow through
strategic relationships with premier lodging groups, including
Access Hotels & Resorts, Accor, Benchmark Hospitality, Davidson
Hotel Company, Evolution Hospitality, HEI Hotels & Resorts,
Highgate Hotels, Hilton, Hyatt Hotels Corporation, IHG, JRK Hotel
Group, Inc., Marriott International, Noble House Hotels &
Resorts, Outrigger Lodging Services, Provenance Hotels, Two Roads
Hospitality, and Viceroy Hotel Group.
About Blackstone Real Estate Advisors L.P.
Blackstone is a global leader in real estate investing.
Blackstone’s real estate business was founded in 1991 and has
approximately $120 billion in investor capital under management.
Blackstone’s real estate portfolio includes hotel, office, retail,
industrial and residential properties in the US, Europe, Asia and
Latin America. Major holdings include Hilton Worldwide, Invitation
Homes (single family homes), Logicor (pan-European logistics) and
prime office buildings in the world’s major cities. Blackstone real
estate also operates one of the leading real estate finance
platforms, including management of the publicly traded Blackstone
Mortgage Trust.
Additional Information about the Proposed Merger and Where to
Find It
This communication relates to the proposed merger transaction
involving the Company. In connection with the proposed merger, the
Company will file relevant materials with the SEC, including a
proxy statement on Schedule 14A (the “Proxy Statement”). This
communication is not a substitute for the Proxy Statement or for
any other document that the Company may file with the SEC and send
to the Company’s shareholders in connection with the proposed
transactions. INVESTORS AND SECURITY HOLDERS OF THE COMPANY ARE
URGED TO READ THE PROXY STATEMENT AND OTHER DOCUMENTS FILED WITH
THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Investors and
security holders will be able to obtain free copies of the Proxy
Statement and other documents filed by the Company with the SEC
through the website maintained by the SEC at http://www.sec.gov.
Copies of the documents filed by the Company with the SEC will be
available free of charge on the Company’s website at
www.lasallehotels.com, or by contacting the Company’s Investor
Relations Department at (301) 941-1500.
The Company and its trustees and certain of its executive
officers may be considered participants in the solicitation of
proxies with respect to the proposed transactions under the rules
of the SEC. Information about the trustees and executive officers
of the Company is set forth in its Annual Report on Form 10-K for
the year ended December 31, 2017, which was filed with the SEC on
February 20, 2018, its proxy statement for its 2018 annual meeting
of shareholders, which was filed with the SEC on March 22, 2018 and
in subsequent documents filed with the SEC. Additional information
regarding the participants in the proxy solicitations and a
description of their direct and indirect interests, by security
holdings or otherwise, will also be included in the Proxy Statement
and other relevant materials to be filed with the SEC when they
become available.
Cautionary Statement Regarding Forward Looking
Statements
This press release, together with other statements and
information publicly disseminated by the Company, contains certain
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. The Company intends
such forward-looking statements to be covered by the safe harbor
provisions for forward-looking statements contained in the Private
Securities Litigation Reform Act of 1995 and includes this
statement for purposes of complying with these safe harbor
provisions. The forward-looking statements contained in this press
release, including statements regarding the proposed merger
transaction and the timing of such transaction, are subject to
various risks and uncertainties. Although the Company believes the
expectations reflected in any forward-looking statements contained
herein are based on reasonable assumptions, there can be no
assurance that our expectations will be achieved. Forward-looking
statements, which are based on certain assumptions and describe
future plans, strategies and expectations of the Company, are
generally identifiable by use of the words “believe,” “expect,”
“intend,” “anticipate,” “estimate,” “project,” or other similar
expressions. Such statements involve known and unknown risks,
uncertainties, and other factors that may cause the actual results
of the Company to differ materially from future results,
performance or achievements projected or contemplated in the
forward-looking statements. Some of the factors that may affect
outcomes and results include, but are not limited to: (i) risks
associated with the Company’s ability to obtain the shareholder
approval required to consummate the merger and the timing of the
closing of the merger, including the risks that a condition to
closing would not be satisfied within the expected timeframe or at
all or that the closing of the merger will not occur, (ii) the
outcome of any legal proceedings that may be instituted against the
parties and others related to the merger agreement, (iii)
unanticipated difficulties or expenditures relating to the
transaction, the response of business partners and competitors to
the announcement of the transaction, and/or potential difficulties
in employee retention as a result of the announcement and pendency
of the transaction, (iv) changes affecting the real estate industry
and changes in financial markets, interest rates and foreign
currency exchange rates, (v) increased or unanticipated competition
for the Company’s properties, (vi) risks associated with the hotel
industry, including competition for guests and meetings from other
hotels and alternative lodging companies, increases in wages,
energy costs and other operating costs, potential unionization or
union disruption, actual or threatened terrorist attacks, any type
of flu or disease-related pandemic and downturns in general and
local economic conditions, (vii) the availability and terms of
financing and capital and the general volatility of securities
markets, (viii) the Company’s dependence on third-party managers of
its hotels, including its inability to implement strategic business
decisions directly, (ix) risks associated with the real estate
industry, including environmental contamination and costs of
complying with the Americans with Disabilities Act of 1990, as
amended, and similar laws, (x) the possible failure of the Company
to maintain its qualification as a REIT and the risk of changes in
laws affecting REITs, (xi) the possibility of uninsured losses,
(xii) risks associated with redevelopment and repositioning
projects, including delays and cost overruns, (xiii) the risk of a
material failure, inadequacy, interruption or security failure of
the Company’s or the hotel managers’ information technology
networks and systems, and (xiv) those additional risks and factors
discussed in reports filed with the SEC by the Company from time to
time, including those discussed under the heading “Risk Factors” in
its most recently filed reports on Form 10-K and 10-Q. The Company
undertakes no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise. Investors should not place undue reliance upon
forward-looking statements.
For additional information or to receive press releases via
e-mail, please visit our website at
http://www.lasallehotels.com/
View source
version on businesswire.com: https://www.businesswire.com/news/home/20180521005541/en/
LaSalle:Kenneth G. Fuller or Max D. LeinweberLaSalle
Hotel Properties301/941-1500orScott Winter / Jonathan
SalzbergerInnisfree M&A Incorporated212/750-5833orMedia:Joele
Frank, Wilkinson Brimmer KatcherMeaghan Repko / Andrew
Siegel212/355-4449
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