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8-K - FORM 8-K - LODGIAN INC | g21838e8vk.htm |
EX-2.1 - EX-2.1 - LODGIAN INC | g21838exv2w1.htm |
EX-99.2 - EX-99.2 - LODGIAN INC | g21838exv99w2.htm |
Exhibit 99.1
For Immediate Release
Contact:
Debi Neary Ethridge
Vice President, Finance & Investor Relations
dethridge@lodgian.com
(404) 365-2719
Contact:
Debi Neary Ethridge
Vice President, Finance & Investor Relations
dethridge@lodgian.com
(404) 365-2719
Lone Star Funds Contact:
Ed Trissel / Jim Shaughnessy
Joele Frank, Wilkinson Brimmer Katcher
etrissel@joelefrank.com / jshaughnessy@joelefrank.com
(212) 335-4449
Ed Trissel / Jim Shaughnessy
Joele Frank, Wilkinson Brimmer Katcher
etrissel@joelefrank.com / jshaughnessy@joelefrank.com
(212) 335-4449
Lodgian to be Acquired by Lone Star Funds
ATLANTA, Ga., January 22, 2010Lodgian, Inc. (NYSE Alternext US:LGN), one of the nations
largest independent hotel owners and operators, today announced it has entered into a definitive
agreement to be acquired by an affiliate of Lone Star Funds (Lone Star), in a transaction valued
at approximately $270 million, including assumed debt.
Under the terms of the agreement, Lone Star will acquire all of the outstanding common stock
of Lodgian for $2.50 per share in an all-cash transaction. The price represents a premium of
approximately 67.2 percent over Lodgians average closing share price during the trading period of
one calendar month prior to January 15, 2010 and 64.3 percent over Lodgians average closing share
price during the trading period of six calendar months prior to January 15, 2010.
Lodgians Board of Directors has unanimously approved the merger agreement and has recommended
approval of the transaction by Lodgian shareholders.
Lodgian
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After careful consideration, and with the assistance of our advisors, Lodgians Board of
Directors determined that a transaction with Lone Star will provide meaningful value and liquidity
to our shareholders, said Daniel E. Ellis, Lodgian president and chief executive officer. We
believe that Lone Star brings considerable real estate experience and financial strength to our
assets, and we look forward to working with Lone Star to transition the business as smoothly as
possible.
We are pleased to welcome Lodgian to the Lone Star family and look forward to working with
their talented team to integrate the business into our portfolio, said Lone Star Funds Andre
Collin, Senior Managing Director, Real Estate Americas. This is a diverse and well-managed hotel
business that will complement our existing real estate assets.
This transaction is not subject to a financing condition, and the purchase price is fully
committed. The transaction is expected to close during the second quarter of 2010, subject to
approval of Lodgian shareholders at a special meeting and satisfaction of customary closing
conditions.
Certain shareholders of Lodgian holding 26.8 percent of the total outstanding common shares
have entered into voting agreements under which they have agreed to vote their shares in favor of
the merger.
Genesis Capital LLC acted as a financial advisor to Lodgian, and Houlihan Lokey Howard & Zukin
Financial Advisors, Inc. has provided a fairness opinion to the Board of Directors of Lodgian.
King & Spalding LLP is acting as legal counsel to Lodgian, and Hunton
& Williams LLP is acting as legal counsel to Lone Star. Dana Ciraldo, previously affiliated
with Hodges Ward Elliott, is acting as financial advisor to Lone Star.
Lodgian
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About Lone Star Funds
Lone Star is a global investment firm that acquires debt and equity assets including
corporate, commercial real estate, single-family residential, and consumer debt products, as well
as banks and asset-rich operating companies requiring rationalization. Since the establishment of
its first fund in 1995, the principals of Lone Star have organized private equity funds totaling
approximately $24 billion of capital that has been invested globally through Lone Stars worldwide
network of affiliate offices.
About Lodgian
Lodgian is one of the nations largest independent hotel owners and operators. The company
currently owns and manages a portfolio of 34 hotels with 6,401 rooms located in 20 states. Of the
companys 34-hotel portfolio, 16 are InterContinental Hotels Group brands (Crowne Plaza, Holiday
Inn, and Holiday Inn Express), 12 are Marriott brands (Marriott, Courtyard by Marriott, SpringHill
Suites by Marriott, Residence Inn by Marriott and Fairfield Inn by Marriott), two are Hilton
brands, and four are affiliated with other nationally recognized franchisors including Starwood,
Wyndham and Carlson. For more information about Lodgian, visit the companys website:
www.lodgian.com.
Additional Information and Where to Find it
In connection with the proposed merger and required shareholder approval, Lodgian will file a
proxy statement with the U.S. Securities and Exchange Commission (SEC). INVESTORS AND SECURITY
HOLDERS ARE ADVISED TO READ THE PROXY STATEMENT AND OTHER RELEVANT MATERIALS WHEN THEY BECOME
AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT LODGIAN AND THE MERGER. Investors
and security holders may obtain free copies of
Lodgian
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these documents (when they are available) and other documents filed with the SEC at the SECs
website at www.sec.gov. In addition, the documents filed by Lodgian with the SEC may be obtained
free of charge by contacting Lodgian, Inc., Attn: Investor Relations, 3445 Peachtree Rd. NE, Suite
700, Atlanta, Georgia, 30326. Our filings with the SEC are also available on our website at
www.lodgian.com.
Participants in the Solicitation
Lodgian and its officers and directors may be deemed to be participants in the solicitation of
proxies from Lodgians shareholders with respect to the merger. Information about Lodgians
officers and directors and their ownership of Lodgians common shares is set forth in the proxy
statement for Lodgians 2009 Annual Meeting of Shareholders, which was filed with the SEC on March
20, 2009. Investors and security holders may obtain more detailed information regarding the direct
and indirect interests of Lodgian and its respective officers and directors in the merger
by reading the preliminary and definitive proxy statements regarding the merger, which will be
filed with the SEC.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the federal
securities laws. All statements, other than statements of historical facts, including, among
others, statements regarding the anticipated merger with Lone Star, Lodgians negotiations with
special servicers and lenders, optional maturity extensions, property dispositions, future
financial position, business strategy, projected performance and financing needs, are
forward-looking statements. Those statements include statements regarding the intent, belief or
current expectations of Lodgian and members of its management team, as well as the assumptions on
which such statements are based, and generally are identified by the use of words such as may,
will, seeks, anticipates, believes, estimates, expects, plans, intends, should or
similar expressions. Forward-looking statements are not guarantees of future performance and
involve risks and uncertainties that actual results may differ materially from those contemplated
by such forward-looking statements. Many of these factors are beyond the companys ability to
control or predict. Such factors include, but are not limited to, the effects of regional, national
and international economic conditions, our ability to refinance or extend maturing mortgage
indebtedness, competitive conditions in the lodging industry and increases in room supply,
requirements of franchise agreements (including the right of franchisors to
Lodgian
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immediately terminate their respective agreements if we breach certain provisions), our ability to
complete planned hotel dispositions, the effects of unpredictable weather events such as
hurricanes, the financial condition of the airline industry and its impact on air travel, the
effect of self-insured claims in excess of our reserves and our ability to obtain adequate
insurance at reasonable rates, and other factors discussed under Item IA (Risk Factors) in
Lodgians Form 10-K for the year ended December 31, 2008, and as updated in our Forms 10-Q for the
quarters ended March 31 and June 30, 2009. We assume no duty to update these statements.
Management believes these forward-looking statements are reasonable; however, undue reliance
should not be placed on any forward-looking statements, which are based on current expectations.
All written and oral forward-looking statements attributable to Lodgian or persons acting on its
behalf are qualified in their entirety by these cautionary statements. Further, forward-looking
statements speak only as of the date they are made, and the company undertakes no obligation to
update or revise forward-looking statements to reflect changed assumptions, the occurrence of
unanticipated events or changes to future operating results over time unless otherwise required by
law.
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