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September 19, 2011 4:27 PM

Simpson Thacher Advises Blackstone Group on $950 Million Hotel Chain Buy

Posted by Brian Baxter

UPDATE: 9/20/11, 1:45 p.m., EDT. Information on additional in-house and outside lawyers advising The Blackstone Group on its acquisition of Mint Hotel have been added to the fifth and sixth paragraphs of this story.

The Blackstone Group announced on Friday that it will acquire the Mint Hotel chain, including London's largest hotel, the 583-room Mint Hotel Tower of London, for roughly $950 million. The deal is the largest takeover in the U.K. hospitality industry in almost four years, according to The Herald of Scotland.

In reaching an agreement to buy the Mint chain, New York–based Blackstone beat out a competing bid from private equity rival TPG Capital, according to The Wall Street Journal. The acquisition of the chain, which owns seven properties in the United Kingdom and another in Amsterdam, expands Blackstone's hotel portfolio ahead of next summer's Olympic games in London. Blackstone's Hilton Worldwide, operator of the Hilton hotel chain, will assume control of the Mint properties, the private equity firm said.

Simpson Thacher & Bartlett corporate partner Stephen Short and tax counsel Meredith Jones in London are advising Blackstone on the transaction. The firm has a longtime client relationship with Blackstone, having advised the private equity giant this year on its $1 billion acquisition of German clothier Jack Wolfskin, $4.1 billion sale of Graham Packaging to Silgan Holding, and $9.4 billion purchase of 588 U.S. shopping centers from Australian mall operator Centro Properties.

Former Simpson M&A chair John Finley, an Am Law Dealmaker of the Year in 2009, left the firm in 2010 to become Blackstone's chief legal officer. Finley succeeded former Simpson partner and current Blackstone senior managing director Robert Friedman, who joined Blackstone in 1999. (The New York Times reported earlier this year that Finley received about $7.3 million in compensation from Blackstone in 2010.)

Simpson also advised Blackstone last year on the successful restructuring of $4 billion in debt for Hilton Worldwide. Simpson previously advised Blackstone on its $26 billion acquisition of the Hilton chain in July 2007.

Blackstone managing director Judy Turchin in New York and Geoffrey Bailhache in London are leading an in-house legal team from the private equity firm advising on the Mint Hotel deal.

John Burns, head of the commercial investment and development practice at British firm Wragge & Co, is serving as U.K. local counsel to Blackstone on its acquisition of Mint Hotel. Dutch local counsel is being provided by cross-border M&A partner Hans Witeween from Stibbe.

Mint Hotel did not provide information on the target company's outside legal advisers. Pauline McFarlane, Mint's in-house legal and administrative director, did not immediately respond to a request for information on the hotel chain's external legal advisers.

Mint Hotel was known as City Inn until last year, when the company, founded in 1995, breached a debt covenant with Lloyds Banking Group. Bloomberg reports that Lloyds's property investment unit Uberior Ventures and City Inn's founders made the decision to sell Mint Hotel to Blackstone, which also recently announced plans to sell its U.K. student accommodation unit for $500 million.

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