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FelCor Raises $550 Million of New Debt
 
IRVING, Texas…April 5, 1999—FelCor Lodging Trust Incorporated (NYSE:FCH), one of the nation’s largest hotel real estate investment trusts (REITs), today announced the following three financing transactions:
  • Five-year, $375 million Senior Term Loan
  • 10-year, $100 million First Mortgage Term Loan
  • 10-year, $75 million First Mortgage Term Loan
The proceeds from the first of these loans were used to immediately pay off FelCor’s $250 million unsecured term loan, which was to mature on December 31, 1999, and the balance will be used to reduce outstanding borrowings by approximately $300 million under its existing $850 million Line of Credit.

On April 1, 1999, FelCor closed the first of these three transactions, the five-year, $375 million Senior Term Loan arranged by Chase Securities Inc. as book manager and The Chase Manhattan Bank as administrative agent.  The Senior Term Loan, which was upsized from $300 million to $375 million due to strong investor demand, is secured by stock and partnership interests in certain subsidiaries of FelCor and bears interest at 250 basis points over LIBOR (30-day LIBOR at March 31, 1999, was 4.94%). The financial covenants in the Senior Term Loan are consistent with those in FelCor’s existing Line of Credit.  In connection with this transaction, FelCor’s $850 million Line of Credit and existing seven and 10-year publicly-traded term notes were equally and ratably secured by the same collateral securing the Senior Term Loan.   Upon FelCor achieving investment grade credit ratings from the applicable rating agencies, the stock and partnership interests collateral will be released.

 On April 1, 1999, FelCor also closed the 10-year, $100 million First Mortgage Term Loan from Prudential Mortgage Capital Company, a subsidiary of The Prudential Insurance Company of America and New York State Teachers’ Retirement System (NYSTRS).  The non-recourse loan, secured by seven Embassy Suites® hotels, carries a fixed rate coupon of 7.54%, matures in April 2009 and amortizes over 25 years. 

FelCor also expects to close on an additional 10-year, $75 million First Mortgage Term Loan with Massachusetts Mutual Life Insurance Company during April 1999.  The non-recourse loan, secured by six Embassy Suites hotels, carries a fixed rate coupon of 7.55%, matures in May 2009 and amortizes over 25 years.

“We have spent the last few months working to pay off short term debt and to increase  availability under our Line of Credit,” stated Thomas J. Corcoran Jr., FelCor’s President and Chief Executive Officer.   “With the two financing transactions completed and the other financing transaction near completion, we have accomplished our debt financing goals.  Our balance sheet remains one of the best in the industry.  The availability under our Line of Credit and our favorable debt maturity profile will allow FelCor the financial flexibility to complete its renovation and rebranding strategy and pursue other investment alternatives to increase shareholder value,” stated Corcoran.

FelCor Lodging Trust is one of the nation?s largest hotel REITs. Since its initial public offering in 1994 with six hotels and 1,479 suites, FelCor?s portfolio has grown to 189 hotels with nearly 50,000 rooms and suites.  The Company?s hotel portfolio is primarily concentrated in the upscale and full-service segments.  FelCor is the owner of the largest numbers of Embassy Suites, Crowne Plaza®, Holiday Inn® and independently owned Doubletree®-branded hotels.  Other leading hotel brands under which FelCor's hotels are operated include Sheraton Suite®s, Sheraton® and Westin®.  FelCor has a current market capitalization of approximately  $3.5 billion.  Additional information on the company can be found on the company’s Web site at www.felcor.com.
 
With the exception of historical information, the matters discussed in this news release include "forward looking statements" within the meaning of the federal securities laws and are qualified by cautionary statements contained herein and in FelCor?s filings with the Securities and Exchange Commission.

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Contact:
 Thomas J. Corcoran, Jr.
President & CEO
Randy L. Churchey
Senior Vice President & CFO
Monica L. Hildebrand
Vice President/Director of Communications
(972) 444-4900
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Also See: Felcor's First Quarter Dividend Represents a 9.5% Annualized Yield for Shareholders / March 1999 
FelCor Lodging Trust Expands Management Team / Sept 1998 

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