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to Sell its Portfolio of 31 Senior Living Communities for $600 million |
| BETHESDA, MD, August 9, 2001 � Crestline Capital
Corporation (NYSE:CLJ) announces that it has entered into an agreement
to sell its portfolio of 31 senior living communities to Senior Housing
Properties Trust (NYSE: SNH), a real estate investment trust (REIT) based
in Newton, Massachusetts. Total consideration for the transaction
is $600 million, including approximately $235 million of existing debt.
The transaction is expected to close in the first quarter of 2002 and is
subject to a successful vote by at least two thirds of the Company�s shareholders,
arranging additional debt financing of $150 million to $175 million and
customary closing conditions.
Bruce D. Wardinski, Chairman of the Board, President and Chief Executive Officer stated, �We are excited to announce the sale of our senior living portfolio to Senior Housing Properties Trust. This transaction is a win for both companies and is consistent with our strategy over the past two years of monetizing our senior living assets. We are now 100% focused on the hotel lodging business. This is an excellent transaction for Crestline and our shareholders which will unlock a substantial amount of capital.� If requested by SNH, the Company will provide $25 million of seller financing to SNH. The note will have a 10% interest rate and a maturity of no more than two years from the date of closing. James L. Francis, Executive Vice President and Chief Financial Officer commented, �The sale price represents an 8.4x multiple on the latest twelve months EBITDA. The transaction has been structured in a tax efficient manner with the sale of the stock of the Company�s wholly owned subsidiary that owns the portfolio. Our tax basis in this subsidiary significantly exceeds our basis in the assets, thereby substantially reducing the taxes due on the sale.� Mr. Francis continued, �After all transaction costs, taxes and the $25 million in seller financing, the Company will receive approximately $320 million in net cash proceeds at closing. With the proceeds from this sale, the anticipated proceeds from the previously announced sale of our ten Residence Inns and the proceeds from the sale of our full-service hotel leases to Host Marriott, we will have a significant cash position of approximately $475 million. As we previously announced, we are exploring all strategic options available for efficiently redeploying our capital and maximizing shareholder value.� Deutsche Bank acted as exclusive advisor to the Company for this transaction. Crestline Capital Corporation is the parent company of Crestline Hotels & Resorts, among the nation's leading independent hotel management companies, and is the owner of one of the nation�s premier senior living community and hotel portfolios. Certain matters discussed herein are forward-looking statements within the meaning of the Private Litigation Reform Act of 1995.
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Larry Harvey (240) 694-2013 www.crestlinecapital.com |