The acquisition of Extended Stay America Inc. (ESA) and its paired-share REIT, ESH Hospitality Inc. (ESH), by funds managed by Blackstone Real Estate Partners and Starwood Capital Group has been completed for $20.50 per paired share in cash in a transaction valued at approximately $6 billion.
As required under the terms of the company’s definitive merger agreement, the board of directors of ESA, on June 15, declared a special cash dividend of $1.75 per share of common stock of ESA that was paid immediately before the effective time of the mergers to holders of record as of the close of business that day. Company shareholders who held their paired shares of common stock on the record date for the special cash dividend and through the effective time of the mergers are entitled to receive an aggregate of $20.50 in cash, consisting of the $1.75 special cash dividend and merger consideration which, as reduced by the $1.75 special cash dividend, was comprised of $10.40 per share of ESA common stock and $8.35 per share of Class B common stock of ESH. As a result of the transaction, the paired shares will cease trading on the Nasdaq Global Select Market.
Goldman Sachs & Co. LLC served as lead financial advisor to the company and BofA Securities also served as financial advisor. Fried, Frank, Harris, Shriver & Jacobson LLP acted as legal counsel.
J.P. Morgan, Citigroup Global Markets Inc. and Deutsche Bank acted as financial advisors and provided debt financing to Blackstone and Starwood. Simpson Thacher & Bartlett LLP acted as legal advisor to Blackstone, and Kirkland & Ellis LLP acted as legal advisor to Starwood Capital.