WHITE PLAINS, N.Y., May 7 /PRNewswire/ -- Starwood Hotels & Resorts
Worldwide, Inc. (the "Company") (NYSE: HOT) announced today that it has agreed
to sell two separate series of zero-coupon convertible senior notes due 2021
("Series A Notes" and "Series B Notes"). The Company anticipates gross
proceeds of approximately $200 million from the sale of Series A Notes and
$300 million from the sale of Series B Notes, and will use those proceeds to
repay a portion of its increasing rate notes that currently bear interest at
LIBOR plus 275 basis points. The initial purchaser of the notes will have a
30-day option to purchase additional notes to cover over-allotment. This
option could give the Company an additional $100 million of gross proceeds.
The Series A Notes will carry a yield to maturity of 1.00% with an initial
conversion premium of 38% on the closing price of Starwood's stock on Friday,
May 4 of $37.85. The Company may not redeem the notes prior to May 25, 2004,
but may at the option of the holders be required to purchase the notes at
their accreted value on May 25 of each of 2002, 2004, 2006, 2011, 2016. So
long as Starwood's closing price exceeds 120% of the accreted Series A Note
conversion price, the notes will be convertible at the option of the holders
into an aggregate of approximately 4.6 million shares assuming the over
allotment is exercised.
The Series B Notes will carry a yield to maturity of 3.25% with an initial
conversion premium of 36% on the closing price of Starwood's stock on Friday,
May 4 of $37.85. The Company may not redeem the notes prior to May 25, 2004,
but may at the option of the holders be required to purchase the notes at
their accreted value on May 25 of each of 2004, 2006, 2011, 2016. So long as
Starwood's closing price exceeds 120% of the accreted Series B Note conversion
price, the notes will be convertible at the option of the holders into an
aggregate of approximately 7.0 million shares assuming the over allotment is
exercised.
Upon redemption, repurchase or maturity, Starwood may choose to pay the
purchase price in cash or Starwood shares at the Company's option. The
offering is scheduled to close on May 25, 2001.
This notice does not constitute an offer to sell or the solicitation of an
offer to buy the notes or any other securities. The offering is being made
only to qualified institutional buyers. The notes and the shares of common
stock issuable upon conversion have not been registered under the United
States or state securities laws and may not be offered or sold in the United
States absent registration or an applicable exemption from registration
requirements.
Starwood Hotels & Resorts Worldwide, Inc. is one of the leading hotel and
leisure companies in the world with more than 725 properties in 80 countries
and 120,000 employees at its owned and managed properties. With
internationally renowned brands, Starwood is a fully integrated owner,
operator and franchiser of hotels and resorts including: St. Regis(R), The
Luxury Collection(R), Sheraton(R), Westin(R), Four Points(R) by Sheraton, W(R)
brands, as well as Starwood Vacation Ownership, Inc., one of the premier
developers and operators of high quality vacation interval ownership resorts.
For more information, please visit Starwood at http://www.starwoodhotels.com.
(Note: This release contains certain statements that may be deemed
"forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
Forward-looking statements are not guarantees of future performance and
involve risks and uncertainties that could cause actual results to differ
materially from historical results or those anticipated at the time the
forward-looking statements are made, including, without limitation, risks and
uncertainties associated with the following: the continued ability of the
Trust to qualify for taxation as a REIT; Starwood's ability to attract and
retain personnel; completion, terms and timing of future acquisitions and
dispositions; the availability of capital for acquisitions and for
renovations; execution of hotel renovation and expansion programs; the ability
to maintain existing management, franchise or representation agreements and to
obtain new agreements on favorable terms; competition within the lodging
industry and from emerging technologies, the cyclicality of the real estate
business; and the hotel business; foreign exchange fluctuations and exchange
control restrictions; general real estate and national and international
economic conditions; political, financial and economic conditions and
uncertainties in countries in which Starwood owns property or operates; and
the other risks and uncertainties set forth in the annual, quarterly and
current reports and proxy statements of the Trust and Starwood. Starwood
undertakes no obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events or
otherwise.)
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SOURCE Starwood Hotels & Resorts Worldwide, Inc.
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Related links:
http://www.starwoodhotels.com
Company News On-Call:
http://www.prnewswire.com/comp/443150.html or fax,
800-758-5804, ext. 443150
CONTACT:
Dan Gibson of Starwood Hotels & Resorts
Worldwide, Inc., 914-640-8175
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