IRVING, Texas and Washington, D.C. – Irving, Texas-based FelCor Lodging Trust Inc. and Washington, D.C.-based MeriStar Hospitality Corp. have agreed to merge. The $2.7 billion transaction will result in a pro forma market capitalization of $6.3 billion for the combined company, and will bring the number ofowned by FelCor to 299 with approximately 78,000 hotel rooms. As a result of the combination, FelCor will own more hotels and rooms than any other U.S. lodging REIT. MeriStar stockholders will receive $4.60 per share. After the merger, MeriStar will continue to manage the newly added hotel assets.
The merger will add diversity to FelCor’s portfolio with an increase of 113 hotels and 28,897 rooms, and will enhance concentration in the upscale and resort segments. FelCor will become the largest independent owner of Crowne Plaza, Doubletree, Embassy Suites, Hilton, Holiday Inn, Radisson, Sheraton and Westin hotels.
Tom Corcoran will continue as president and CEO of FelCor. Paul Whetsell and Stephen Jorns will join the FelCor board of directors. FelCor will continue to be headquartered in Irving, Texas.