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Blackstone, MeriStar Plan $2B-Plus Merger

BETHESDA, MD-MeriStar Hospitality Corp. commits to merging with an affiliate of New York City's the Blackstone Group in a $2.6-billion deal. The transaction is expected to close next quarter.

By Barbra Murray | Updated on February 21, 2006

BETHESDA, MD-Signing an agreement valued at approximately $2.6 billion, MeriStar Hospitality Corp. has consented to a merger with an affiliate of New York’s the Blackstone Group. Owners of MeriStar common stock and units of limited partnership interests in the locally headquartered hotel REIT’s operating partnership, MeriStar Hospitality Operating Partnership LP, will be entitled to an exchange of $10.45 in cash, per share.

“MeriStar as an entity will be abolished; the MeriStar name will go away,” a MeriStar spokesperson tells GlobeSt.com. “The deal came together very quickly, so what Blackstone will call the hotels has not been determined. And where the merged company will be domiciled remains to be seen. Blackstone is headquartered in New York; whether or not an office will remain here in Bethesda will be determined later.”

Currently, MeriStar’s portfolio consists of 57 high-end hotels with an aggregate 16,507 room in major markets in 19 states and the District of Columbia. Earlier this month, Blackstone inked a deal to acquire 10 MeriStar properties–nine hotels accounting for a total of 1,948 rooms and a golf and tennis club, all located in Florida– for about $367 million.

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