Press Release: WestCoast Hospitality Corporation
January 3, 2002
BEVERLY HILLS, CA, and SPOKANE, WA -- WestCoast Hospitality Corporation (NYSE: WEH), owner, manager and franchisor
of full-service hotel properties in the Western United States, announced yesterday its acquisition of all of the
capital stock of Red Lion Hotels, Inc. from Hilton Hotels Corporation (NYSE: HLT), one of the world's premier owners
and operators of hotel properties. The total consideration paid was approximately $50.6 million.
Red Lion's hotel portfolio consists of eight owned Red Lion hotel properties, 11 leased Red Lion hotel properties,
22 franchised Red Lion hotel properties, one owned Doubletree hotel property located in Pasco, Washington, (279
rooms), and one leased Doubletree hotel property located in Boise, Idaho, (182 rooms). The Red Lion hotels total
6,052 rooms, and are located primarily in the Western U.S., including Washington, Oregon, California, Montana,
Colorado, Idaho, Arizona, Nevada, Wyoming, Missouri, Nebraska and Minnesota.
As a result of the acquisition, WestCoast adds critical mass by doubling the total number of rooms in its hotel
portfolio, from 8,600 rooms in 46 hotels located in 9 states to more than 15,000 rooms in 89 hotels located in
13 states.
Donald Barbieri, Chairman, President and CEO of WestCoast Hospitality Corporation, commented, ``The Red Lion acquisition
will bring us into 34 new markets and we expect to increase our market share with the combined sales efforts of
the two chains. We are fortunate to be bringing a talented group of associates into the WestCoast family of hotels.''
WestCoast's presence will expand into such key markets as San Diego and Sacramento, California; Colorado Springs
and Denver, Colorado; St. Paul, Minnesota; Omaha, Nebraska; and Springfield, Missouri.
Financing for the acquisition was provided by the WestCoast Hospitality Corporation Credit Facility and redeemable
non-convertible preferred stock through Hilton Hotels Corporation. WestCoast expects the transaction to be immediately
accretive and will provide pro forma financials in its Fourth Quarter 2001 earnings release. On an after-tax basis,
Hilton expects the transaction to result in a nominal book gain.
WestCoast Hospitality Corporation, headquartered in Spokane, Washington, owns, operates, franchises, acquires,
develops, renovates and re-brands full service hotel properties under its proprietary brand, WestCoast®. Formerly
known as Cavanaughs Hospitality Corporation, the Company completed its initial public offering in 1998, and converted
its Cavanaughs Hotels to the WestCoast brand in 2000, after the acquisition of WestCoast Hotels, Inc. Prior to
the Red Lion acquisition, WestCoast's hotel portfolio consisted of approximately 46 three and four diamond hotel
properties located in 9 states, all of which service business, convention and leisure travelers. WestCoast Hospitality
Corporation also provides entertainment ticketing through its TicketsWest ticketing network, with operations in
many of the markets served by its hotels. WestCoast believes the combination of entertainment with hotels provides
customers with a one stop shopping approach that many consumers are looking for today.
Hilton Hotels Corporation is recognized internationally as a preeminent hospitality company, which develops, owns,
manages or franchises approximately 2,000 hotels, resorts and vacation ownership properties. Its portfolio includes
many of the world's best known and most highly regarded hotel brands, including Hilton®, Conrad(TM), Doubletree®,
Embassy Suites Hotels®, Hampton Inn®, Hampton Inn & Suites®, Harrison Conference Centers®,
Hilton Garden Inn®, Hilton Grand Vacations Company® and Homewood Suites® by Hilton.
Red Lion Hotels, Inns and Inns & Suites are well known and respected for serving the needs of business and
leisure travelers. Founded in 1959, Red Lion earned a reputation as the hotel brand of choice in the Northwest
and Western United States. In 1996, Red Lion was sold to Doubletree and subsequently became part of Promus Hotel
Corporation when those two companies merged in 1997. Hilton acquired Promus in November 1999.
Lehman Brothers Inc. acted as financial advisor to WestCoast.
Note: This press release contains ``forward-looking statements'' within the meaning of federal securities law,
including statements concerning business strategies and their intended results, and similar statements concerning
anticipated future events and expectations that are not historical facts. The forward-looking statements in this
press release are subject to numerous risks and uncertainties, including the effects of economic conditions; supply
and demand changes for hotel rooms; competitive conditions in the lodging industry, relationships with clients
and property owners; the impact of government regulations; and the availability of capital to finance growth, which
could cause actual results to differ materially from those expressed in or implied by the statements herein.
SOURCE: WestCoast Hospitality Corporation