Will Blackstone’s Hilton Deal Put Others in Play?

Now this is a transaction that was bound to happen months ago. Although the valuation is certinly on the upper part of the scale, given consolidation and specialization of leading and medium sized hotel conglomerates, this question (topic of this message) posted by WSJ is certainly one worth taking a look at. Given the equity structure at Marriott and more favorable valuation that could be obtained for Starwood, I’d say that the competition is going to be intense, given the publicty and popularity (sexyness) of this industry…

 

Will Blackstone’s Hilton Deal Put Others in Play?

Marriott, Starwood
May Draw Interest;
Acting Like Investors
By TAMARA AUDI and PETER SANDERS
July 5, 2007; Page A3

With Blackstone Group‘s agreement to acquire Hilton Hotels Corp. for $20 billion in cash, acquisitive private-equity buyers have finally cracked the Big Three of U.S.-based publicly held hotel giants — and instantly raised the question of whether Marriott International Inc. or Starwood Hotels & Resorts Worldwide Inc. might be next.

The Hilton deal also highlights a new reality in the buyout world: Some private-equity giants have amassed so many assets in certain sectors that they are behaving like strategic investors rather than calculated short-term buyers.