News Column

Extended Stay America Announces Pricing of $375 Million Senior Secured Term Loan

June 9, 2014

- Proceeds to Refinance Remainder of Outstanding Mezzanine Debt -

- Lowers Cost of Debt and Maintains Financial Flexibility –

CHARLOTTE, N.C.--(BUSINESS WIRE)-- Extended Stay America, Inc. (NYSE:STAY) (the “Company”) today announced that its subsidiary, ESH Hospitality, Inc., priced a $375 million Senior Secured Term Loan (the “Term Loan”) at LIBOR plus 4.25%, with a minimum LIBOR of 0.75%, with a five year term, and offered at 99.5. The financing is expected to close on June 23, 2014, subject to the execution of definitive documentation and customary closing conditions. The proceeds of the Term Loan will be used to refinance the existing outstanding $365 million of 9.4% mezzanine debt and pay related transaction fees and expenses.

“The new Term Loan allows us to reduce our cash interest expense by approximately $16 million annually, lowers our average cost of debt to under 4%, and, with a one year non-call period, provides us our desired flexibility to deleverage over time” stated Peter Crage, Chief Financial Officer.

The Term Loan was arranged by Goldman Sachs Bank USA, Citigroup Global Markets Inc., Deutsche Bank Securities Inc. and J.P. Morgan Securities LLC.

Forward Looking Statements

This press release contains forward-looking statements within the meaning of the federal securities laws. Statements related to, among other things, the consummation of the Term Loan and potential changes in market conditions constitute forward-looking statements. For a description of factors that may cause the Company’s actual results, performance or expectations to differ from any forward-looking statements, please review the information under the heading “Risk Factors” included in the Company’s combined annual report on Form 10-K filed with the SEC on March 20, 2014 and other documents of the Company on file with or furnished to the SEC. Any forward-looking statements made in this press release are qualified by these cautionary statements, and there can be no assurance that the actual results or developments anticipated by the Company will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, the Company or its business or operations. Except as required by law, the Company undertakes no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. We caution you that actual outcomes and results may differ materially from what is expressed, implied or forecasted by the Company’s forward-looking statements.

About Extended Stay America

Extended Stay America, Inc., the largest owner/operator of company-branded hotels in North America, owns and operates 684 hotels in the U.S. and Canada comprising approximately 76,200 rooms and employs approximately 10,000 employees in its hotel properties and headquarters. The Company owns and operates hotels under the core brand Extended Stay America®, which serves the mid-priced extended stay segment, and other brands. Visit for more information about the Company and its services.


Extended Stay America, Inc.

Kay Sharpton, 980-345-1546

Source: Extended Stay America, Inc.

For more stories on investments and markets, please see HispanicBusiness' Finance Channel

Source: Business Wire

Story Tools Facebook Linkedin Twitter RSS Feed Email Alerts & Newsletters