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and Sanderson Hotel in London |
| NEW YORK, Aug. 27, 2004 - Ian Schrager, Chairman
and Chief Executive Officer of Morgans Hotel Group, today announced that
he has received expressions of interest to purchase two of his London Hotels
-- the St. Martins Lane and Sanderson Hotel -- and, accordingly, MHG is
retaining a property agent to explore the possible sale of those properties.
MHG will retain management of the properties in any sale that might take
place.
"Given today's market and the prices we believe we can obtain for these properties, we felt obligated to explore this possibility," Mr. Schrager said. "These hotels are doing extremely well. They are significantly outperforming the market." Mr. Schrager said that while he would not comment on the prices he anticipated receiving for the properties, should he sell them, the amount was far in excess of the 100 million pounds cited by a London newspaper recently. He added, "Funds we will receive from these properties, should we sell them, along with the steps we have recently taken to strengthen our balance sheet will enable us to aggressively accelerate the growth of our company and improve upon our existing asset base." Mr. Schrager said his firm is continually exploring opportunistic acquisitions and looking for ways to further expand in a revived and vibrant hotel market. "We are very excited about the prospects for our company and intend to build upon its current strengths," he said. Earlier this month, MHG announced that it had completed a $475 million recapitalization, refinancing all of its third party corporate debt and all of the debt secured by its Hudson, Royalton, Morgans, Mondrian and Delano properties in the United States. In July, MHG announced the completion of the sale of a 90% interest in its Paramount Hotel in New York City for $128.5 million to Becker Ventures, a private investment company whose investments have included the Hard Rock Hotel in Chicago. Just a few days before that, the company announced that it had entered into a sale/leaseback transaction on its San Francisco Clift Hotel under which MHG will receive $71 million and it will retain a 99 year leasehold, providing MHG with any profit that might ensue from operations or a capital transaction. |
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Morgans Hotel Group |