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Merger Due to Adverse Financial Markets |
| IRVING, Texas and WASHINGTON, Sept. 21, 2001
- FelCor Lodging Trust (NYSE: FCH), the nation's second largest hotel real
estate investment trust (REIT), and MeriStar Hospitality Corporation (NYSE:
MHX), the nation's third largest hotel REIT, today announced that the companies
have jointly agreed to terminate their previously announced merger due
to adverse changes in the financial markets. Both companies have cancelled
their respective shareholder meetings to vote on the matter.
"The termination of this merger is the result of the recent tragic events and their subsequent adverse impact on the financial markets,'' said Thomas J. Corcoran, Jr., president and CEO of FelCor. ``A lot of dedicated people worked very hard on this transaction, but Paul Whetsell of MeriStar and I have agreed to focus now on our respective businesses.'' The aftermath of the terrorist attacks also will adversely impact previously issued earnings guidance for each of the companies. Both companies expect to provide updated guidance at their respective third quarter conference calls. There is no "break-up fee'' associated with the merger termination. MeriStar said that the REIT's management team will continue to actively asset manage its portfolio of 112 hotels, which will be operated and managed by MeriStar Hotels & Resorts, the nation's largest independent hotel management company. FelCor's hotel portfolio consists of 185 hotels with nearly 50,000 rooms and suites and is concentrated primarily in the upscale and full-service segments. This press release contains ``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 about FelCor Lodging Trust and MeriStar Hospitality Corporation.
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| www.felcor.com
www.meristar.com |