HotelNewsNow.com recaps hotel-related financial news each Friday. Following is the update for Accor, Chatham Lodging Trust, Host Hotels & Resorts, The Rezidor Hotel Group and Strategic Hotels & Resorts.
Accor SA
Paris-based Accor SA (EPA: AC) said it is selling off 450 hotels by 2013 as part of an ongoing portfolio adjustment. The sales, which are expected to increase cash by €1.6 billion (US$2 billion) represents more than a quarter of the company’s 1,600 hotels. On a normalized, annual basis, the property sales will result in a reduction of revenue by €150 million-€200 million (US$183 million-US$244.1 million).
Adjusted net debt is expected to be reduced by €200 million-€300 million (US$244.2 million-US$366.3 million) a year as a result of the transactions.
Accor said it also plans to begin opening between 35,000 and 40,000 rooms per year after 2012. The openings will occur in Europe and “countries with high growth potential.”
Chatham Lodging Trust
Chatham Lodging Trust (NYSE: CLDT), a real estate investment trust based in Palm Beach, Florida, signed a contract to acquire four hotels for US$61 million, or US$137,387 per key, including approximately US$12.5 million of debt on two of the properties.
The properties are a Residence Inn by Marriott in Westchester County, New York; Hampton Inn & Suites in Houston; and a Courtyard by Marriott and SpringHill Suites in Pennsylvania.
Host Hotels & Resorts
Bethesda, Maryland-based Host Hotels & Resorts (NYSE: HST) said it will redeem slightly more than 4 million of the REIT’s 8.88 percent Class E cumulative redeemable preferred stock, which represents all issued and outstanding shares, on 18 June 2010.
The shares will be redeemed for US$25 per share plus just more than 39 cents per share of dividends accrued from 15 April 2010 to the redemption date of 18 June.
The Rezidor Hotel Group
Privately held Carlson has become the majority shareholder of The Rezidor Hotel Group AB (PINK: REZIF) of Brussels, Belgium. Carlson owns 50.1 percent of Rezidor’s outstanding shares.
“We see great value creation potential in Rezidor, and believe that both companies will benefit from continued collaboration on global brand strategies, enhanced customer offerings, revenue generation and consistent global growth,” said Hubert Joly, Carlson’s president, CEO and director.
Strategic Hotels & Resorts
Strategic Hotels & Resorts (NYSE: BEE) of Chicago said it sold 75.9 million shares of common stock for US$4.60 per share, including 9.9 million shares of common stock issued pursuant to the exercise in full of the underwriters’ over-allotment option.
The company received approximately US$333.1 million from the offering after underwriting discounts and commissions. A portion of the proceeds will be used to fund the company’s tender offer for any and all of the outstanding 3.50 percent exchangeable senior notes due 2012 of Strategic’s operating partnership, Strategic Hotel Funding LLC.
The remaining proceeds will be used for general corporate purposes, including repurchasing exchangeable notes, reducing borrowings under its credit facility, repaying debt, and funding capital expenditures and working capital.
