Wyndham International, Inc. and Patriot American Hospitality, Inc. (Wyndham), whose shares are paired and trade together (NYSE:PAH), today jointly announced with Interstate Hotels Corporation (Nasdaq:IHCO) that the Interstate spin-off has been completed.
Wyndham distributed 92% of Interstate in the form of a dividend to Wyndham`s shareholders. The remaining 8% of Interstate is owned equally by Wyndham and Marriott International, Inc. (NYSE:MAR).
James D. Carreker, Chairman and Chief Executive Officer of Wyndham, said, “With today`s distribution, we are unlocking incremental value for our shareholders. Now, in addition to owning one of the nation`s largest branded hotel companies, our shareholders also have a direct ownership stake in Interstate, one of the leading third-party hotel management companies.”
Thomas F. Hewitt, Chairman and Chief Executive Officer of Interstate, said, “As an independent third-party hotel manager, we believe we have the financial and organizational structure that will enable us to create shareholder value by building on the outstanding relationships we have forged with most of the major branded hotel companies over our 38-year history. Our management team is strong and includes several key executives whose association with Interstate spans decades. J. William Richardson, Executive Vice President and Chief Financial Officer, and Kevin P. Kilkeary, President and Chief Operating Officer, have been with the Company for more than 40 years combined.”
Hewitt joined Interstate in March 1999 from Carnival Resorts & Casinos where he had been President and Chief Operating Officer. Before that, he worked for Sheraton Corporation for more than 20 years, eventually serving as President of its North American division.
Wyndham shareholders received one share of Interstate Class A Common Stock for every 30 securities of Wyndham. Cash is being paid in lieu of any fractional shares in an amount determined by multiplying each fractional share by $6.00 (the estimated initial value of Interstate shares).
Wyndham currently has approximately 167 million shares and equivalents outstanding, not including approximately 97 million shares currently held by counterparties to forward equity transactions. Wyndham has entered into agreements with the counterparties providing that the counterparties will return their Interstate shares to Wyndham in return for certain adjustments to the forward equity contracts, resulting in the cancellation of their Interstate shares. On a proforma basis after giving effect to the agreements with the forward equity holders, Interstate will have approximately 6.3 million shares outstanding.
The distribution was paid today to Wyndham shareholders of record at the close of business on June 7, 1999, in the form of a taxable dividend.
About Interstate Hotels Corporation:
Interstate, one of the largest independent hotel management companies in the United States, operates approximately 165 hotels with more than 31,000 rooms in 37 states in the United States as well as Canada, the Caribbean and Russia. These statistics exclude the hotels that will be managed by Wyndham or Marriott International under the terms of the settlement agreement with Marriott International.
About Patriot American Hospitality, Inc. and Wyndham International:
Patriot American Hospitality, Inc. ranks among the nation`s largest branded hotel companies. Its paired operating company, Wyndham International, Inc., comprised of the Grand Bay Hotels & Resorts Division, the Wyndham Hotel Group and PAH Management Services, leases, manages and franchises primarily upscale and luxury hotel and resort properties represented by its proprietary brands and provides management services for third-party owned hotels and resorts. Taking account of the spin-off of Interstate, Wyndham`s portfolio includes 311 hotels and resorts with more than 74,000 rooms.