PITTSBURGH- Interstate Hotels Corp. has reviewed the letter from the Shaner Hotel Group increasing its unsolicited purchase proposal from $4.125 to $4.50 per share.
The board of directors of Interstate, after considering the revised proposal, has determined that it is not a “Superior Proposal” of the type necessary to permit negotiations and due diligence in accordance with the terms of the companys definitive agreement with the Lehman group.
In addition, the board concluded that the Shaner groups proposed $1 million escrow is insufficient to protect the company financially against the potential consequences of entering into negotiations with the Shaner group.
The board is urging its stockholders to approve the Lehman group transaction at a special meeting on October 16, 2000. The closing of the Lehman group transaction is scheduled to occur the day after the meeting assuming a favorable stockholder vote. (10/13/00)