Blackstone to buy Hilton Corporation for $26 billion

Private equity giant Blackstone Group will buy Hilton Hotels Corporation in an all-cash deal worth 26 billion dollars (19 billion euros), one of the largest such take-overs ever, the hotel chain said.
Under the terms of the agreement announced Tuesday, Blackstone will acquire all the outstanding common stock of Hilton for 47.50 dollars per share. The price represents a premium of 40 percent over Monday's closing stock price. Hilton Hotels stock closed up 6.44 percent Tuesday on the New York Stock Exchange at 36.05 dollars.
Hilton's Board of Directors approved the transaction Tuesday, which will be completed during the fourth quarter of 2007 subject to shareholder approval, the corporation said in a statement. When completed, the merger will be one of the 10 biggest by an investment fund. The largest was announced Saturday by Canadian pension fund Private Capital, which is leading a group buying Canadian telecoms giant BCE (Bell Canada) for 48.5 billion dollars.
Blackstone intends to invest in the Hilton properties and brands globally to enhance and grow the business for the benefit of owners, franchisees and customers, Hilton said. "Our priority has always been to maximise shareholder value. Our Board of Directors concluded that this transaction provides compelling value for our shareholders with a significant premium," said Hilton co-chairman and chief executive officer Stephen Bollenbach.
"We are delighted that a company with the resources and reputation of Blackstone fully appreciates the value inherent in our global presence," he added. "This transaction is about building the premier global hospitality business," Blackstone senior managing director Jonathan Gray said. "We are committed to investing in the company and working with Hilton's outstanding owners and franchisees to continue to grow and enhance the business," Gray added.
The acquisition brings together a leading global hospitality company with Blackstone's extensive portfolio of hotels and resorts, with more than 100,000 hotel rooms in the United States and Europe. Blackstone said in a statement that "no significant divestitures are envisaged as a result of this transaction."rust.