MeriStar, Pa. Hotel Firm to Merge; $68 Million Deal With Interstate to Create Management Giant
MeriStar Hotels & Resorts Inc. of the District said it is merging with Interstate Hotels Corp. of Pittsburgh in a deal valued at $68 million that will make it one of the largest independent hotel- management companies.</br></br>The combined company will be called Interstate Hotels Corp. and will be based in the District. It will have estimated pro forma revenue of $340 million for 2002 from the 412 hotels in the United States, Canada and Europe that it will operate.</br></br>The deal, whose value is based on MeriStar's closing stock price of $1.21 on Wednesday, is expected to close by the summer.</br></br>MeriStar runs 277 hotels in 42 states, the District and Canada, as well as Doral resorts and conference centers and one of the world's largest corporate housing systems. Interstate operates 135 hotels in 37 states, the District, Canada and Russia.</br></br>Under the deal, each MeriStar share will be swapped for one share in the new group. Interstate shareholders would get 4.6 shares for each share they hold.