Four Seasons goes private with $3.4 billion buyout

Following a wave of consolidations in the lodging industry, Four Seasons Hotels Inc. becomes the latest target of a trend toward taking hotel operators private. Canadian-based luxury hotel chain on Monday accepted a $3.4 billion bid from an investor group that includes its own chief executive as well as Saudi Prince Alwaleed Bin Talal and Microsoft Chairman Bill Gates.

Including debt, the transaction is valued at $3.8 billion, Four Seasons said.

The joint offer from a team that included Isadore Sharp, Four seasons chairman and CEO, controlling shareholder Triples Holdings Ltd., Kingdom Hotels, owned by Prince Alwaleed Bin Talal Bin Abdulaziz Alsaud, Bill Gates through his holding company Cascade Investment was placed before the company’s board in November 2006.

According to the deal, shareholders will get $82 a share. Isadore Sharp, 75, the hotelier's chairman and CEO will receive a one time payment of $289 million as part of the transaction.

Triples would hold about 10 percent of the shares of Four Seasons through a separate class of special voting shares, with the balance split between Kingdom Hotels and Cascade.

Sharp would remain the chairman and chief executive of Four Seasons. He and his family will be directly involved in the chain's operations and strategy, Four Seasons said.

The company's headquarters would remain in Toronto.

The deal "is the best way to preserve and expand the long-term strategy, vision and core values of Four Seasons," Sharp said. “I am delighted that the board, after considering the recommendations developed by the special committee and its advisers, has determined to support what I believe.”

The luxury hotel chain was founded by Isadore Sharp in 1960 and is headquartered in Toronto, Canada.

Canadian-based, Four Seasons manages 74 hotels in 31 countries and has 25 hotels under development. It is rated AAA five diamond hotel by the Travel and Leisure magazine and Zagat Guide.

Shares of Four Seasons fell $2.52, or 3 percent, to $81.36 at 4:20 p.m. in New York Stock Exchange composite trading.

Meanwhile, Four Seasons' board sought advice from Merrill Lynch on whether the buyout was fair to shareholders.