Hyatt To Sell 38 Hotels To Lone Star Funds For About $590 Mln

(RTTNews) - Hyatt Hotels Corp. (H) said Thursday that it has agreed to sell 38 select-service hotels to a company organized by private equity firm Lone Star Funds for about $590 million. The portfolio of 38 hotels consists of Hyatt Place and Hyatt House hotels totaling 4,950 rooms.

Under a franchise agreement entered into by Hyatt with Lone Star Funds as part of the sale, all the hotels will maintain their existing Hyatt Place and Hyatt House branding. The transaction is expected to be completed in November 2014.

Hyatt noted that Lone Star Funds intends to spend about $50 million in additional capital expenditures across the Hyatt Portfolio over the next 24 months. Aimbridge Hospitality, LLC will manage the hotels for Lone Star.

Steve Haggerty, global head of capital strategy, franchising and select service for Hyatt said, "We believe the renovations planned for the portfolio will help maintain the brands' reputation as the leading brands in their segments and we look forward to deepening our relationship with Lone Star and Aimbridge."

Since the establishment of its first fund in 1995, Lone Star has organized thirteen private equity funds with aggregate capital commitments totaling over $52 billion.

H closed Thursday's trading at $63.38, up $0.80 or 1.28 percent on a volume of 484,958 shares.