MeriStar Hotels & Resorts, American Skiing Plan Merger

WASHINGTON, DC-In a deal expected to be complete in the first calendar quarter of 2001, the nation’s largest independent hotel management firm will merge with the country’s largest ski resort operating company. Officials from MeriStar Hotels & Resorts and American Skiing Company say they signed a definitive agreement to join forces.

Pending customary conditions, including regulatory and shareholder approval, the merged company will be renamed Doral International Inc. and will focus on international leisure and hospitality. Doral International will have assets exceeding $1.2 billion, pro forma FY 2001 revenues of approximately $600 million, and expected pro forma EBITDA in FY 2001 in excess of $100 million.

Doral International will be headquartered in Washington, DC at Meristar’s 1010 Wisconsin Ave. offices. Leslie B. Otten will be chairman, Paul W. Whetsell, chief executive officer, and John Emery, chief financial officer.

In this tax-free, stock-for-stock merger, MeriStar will merge into American Skiing Co. which will be renamed Doral International. The company will manage, operate, own and develop Doral-branded, year-round mountain and beach resorts, vacation villages and conference centers. It will also manage upscale hotels for third-party owners, as well as operate corporate housing under its proprietary BridgeStreet Accommodations brand.

The planned merger combines nine premium ski resorts, 23 resort hotels, 246 hotels, 15 golf courses and four conference facilities. The company also will control mountain and beach real estate available for future development of more than 14,000 units.

Doral International will operate four major business units. The first, Doral Leisure, will specialize in year-round resorts. The second will focus on managing upscale, full-service hotels under a wide variety of franchise flags. The third will be international corporate housing under the BridgeStreet Accommodations brand, with more than 3,700 units in the United States and Europe. The fourth will focus on development of upscale vacation villages and resort real estate.

Upon completion of the merger, the company expects to have approximately 190 million shares outstanding on a fully diluted basis. The company’s real estate subsidiary, American Skiing Co. Resort Properties, will remain a separate subsidiary, with its existing non-recourse debt remaining intact.