Host Marriott Buying Hotels From Starwood

Host Marriott Corp., Bethesda, Md., is acquiring a portfolio of 38 luxury hotels from Starwood Hotels and Resorts for about $4.04 billion.The portfolio consists of 25 domestic and 13 international properties with a total of 18,964 rooms, Host Marriott said. The hotel real estate investment trust said it expects to assume about $700 million of debt and to issue about $2.3 billion worth of equity to Starwood stockholders, 133.529 million shares at an exchange price of $17 per share, as part of the transaction. W. Edward Walker, executive vice president and chief financial officer of Host Marriott, said the company has also arranged a bridge loan commitment with Goldman, Sachs & Co. and Deutsche Bank Securities. He said the company expects "to obtain permanent financing through a variety of attractive options including unsecured and secured debt, asset sales, and potentially arranging a third-party joint venture for the European assets."