Skift Take

Mergers and acquisitions between hotel brands was just the start. Expect to see more mergers take place between the hotel owners and real estate investment trusts going forward.

LaSalle Hotel Properties, the target of a $3.6 billion takeover offer from Pebblebrook Hotel Trust, has attracted interest from other potential buyers, according to people with knowledge of the matter.

Blackstone Group LP, Starwood Capital Group, Brookfield Property Partners LP and publicly traded real estate investment trusts Park Hotels & Resorts Inc. and Sunstone Hotel Investors Inc. are among interested parties who have signed or are in discussions to sign nondisclosure agreements for access to due diligence, said some of the people, who asked not to be identified because the process is confidential.

In mergers and acquisitions, bidders often decide whether or not to make takeover offers based on what they learn from due diligence that is in part based on information provided in a so-called data room. Representatives for Blackstone, Starwood and Park Hotels declined to comment, while representatives for Brookfield and Sunstone didn’t respond to requests for comment. A spokesman for LaSalle declined to comment.

The Bethesda, Maryland-based owner of 41 upscale hotels hasn’t publicly said that it’s exploring strategic alternatives, but has said that its board of directors will “consider any alternatives that enhance long-term shareholder value.”

On Monday, LaSalle said it will “carefully review” a revised proposal from Pebblebrook that includes a cash component and is roughly 6 percent higher than the REIT’s previous all-stock offer. Pebblebrook hasn’t signed an NDA, according to people with knowledge of the matter.

Earlier this month, Evercore ISI analyst Rich Hightower estimated that there was an 80 percent probability that LaSalle would be acquired either by Pebblebrook or another buyer.

LaSalle’s shares closed Monday at $30.71, about 3.9 percent less than the implied value of Pebblebrook’s offer.


©2018 Bloomberg L.P. This article was written by Gillian Tan from Bloomberg and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to [email protected].


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Tags: blackstone, brookfield, mergers and acquisitions, real estate, starwood capital

Photo credit: Blackstone and others are interested in spending billions to acquire hotel real estate investment trust company LaSalle Hotel Properties. Bloomberg

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