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GlobeSt.com UPDATE: Starwood and Lehman Confirm Le Meridien Deal

WHITE PLAINS, NY-Starwood Hotels & Resorts and Lehman Brothers Holdings acquired all of the $1.3 billion of outstanding senior debt of Le Meridien Hotels and Resorts Ltd. of London at an unspecified discount.

By John Jordan | Updated on December 30, 2003

WHITE PLAINS, NY-Starwood Hotels & Resorts Worldwide Inc. and Lehman Brothers Holdings Inc. acquired all of the outstanding debt, estimated to be approximately $1.3 billion, of London-based Le Meridien Hotels and Resorts Ltd. at an undisclosed discount price. Officials with Starwood confirmed published reports that a deal was in the works for the Le Meridien chain. However, they would not disclose what the discounted price was for the senior debt of Le Meridien.

Starwood officials state that the company will fund $200 million through a high yield junior participation in the debt. Lehman Brothers will own the remaining senior debt of approximately $1.1 billion. As part of the funding agreement, Starwood and Lehman Brothers have entered into an exclusive agreement with Le Meridien’s debt holders, including Merrill Lynch, CIBC and a number of other major financial institutions, to negotiate the recapitalization of the Le Meridien firm in the coming months.

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