LaQuinta Confirms Acquisition by Blackstone Group
IRVING, TX, November 9, 2005. Following a report in Hotel Business yesterday, LaQuinta Corp., whose core brands are midprice LaQuinta Inns and Baymont Inns, confirmed that it has agreed to be acquired by an affiliate of the Blackstone Group for $3.4 billion.
The transaction is scheduled to close in Q1 2006. Of the $3.4 billion, LaQuinta sharesholders are receiving an equity payment of $2.3 billion. Blackstone is paying approximately $800 million in LaQuinta debt. The remainder covers transaction costs.
According to LaQuinta CEO Francis (Butch) Cash, Blackstone, a New York-based private equity firm, intends to retain the franchise operation of both the LaQuinta and Baymont brands. Combined, the company operates 360 hotels, more than 240 of which are franchises, in 39 states.
The LaQuinta acquisition is the latest in a series of hospitality industrydeals Blackstone has concluded lately, the most recent of which was the acquisition of Wyndham International in August. In that case, Blackstone retained a limited number of key assets, creating a new luxury brand called LXR Resorts, and quickly resold the brand and franchise system to Cendant Hotel Group. Similarly, Blackstone acquired Prime Hospitality in 2004 and proceeded to resell the AmeriSuites brand to Global Hyatt Corp. Cash said Blackstone had no plans to dispose of LaQuinta assets in such a way.
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