Hilton to be acquired by Blackstone Group in $26B deal

Hilton Hotels Corp. has agreed to be acquired by the Blackstone Group, in an all-cash transaction valued at approximately $26 billion, the companies said Tuesday.

Blackstone said it would acquire all of the outstanding common stock of Hilton for $47.50 per share, a 40% premium over Hilton's July 2 closing price of $33.87 per share.

Blackstone, a global private equity firm, began trading on the New York Stock Exchange on June 22. The company has been involved in several large travel company acquisitions over the years; it currently owns Travelport, the La Quinta Corp. and LXR Luxury Resorts, and it recently sold the Extended Stay Hotels and Budgetel brands. In 2005 it sold the management and franchise business of the Wyndham chain for $101 million.

Hilton's portfolio includes nine hotel and hospitality brands, among them Hilton, Conrad Hotels, Embassy Suites Hotels and the Waldorf-Astoria Collection. In 2006 it was the fifth-largest hotel company by number of rooms, at 393,922, and the sixth-largest by number of hotels, at 2,460, according to data from the American Hotel and Lodging Association.

Hilton's board of directors approved the transaction on July 3. Pending shareholder approval, the deal is expected to close in the fourth quarter.

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