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Deal completed for Innkeepers acquisition by Chatham and Cerberus

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Published on 31/10/11 - Updated on 17/03/22

Chatham Lodging Trust and Cerberus Capital Management LP said Thursday that they have completed their $1.02 billion acquisition of 64 hotels owned by Innkeepers USA Trust.

According to Bloomberg Businessweek, the deal, which includes the assumption of $675 million in mortgage debt on 45 of the hotels, enables Innkeepers to exit Chapter 11 bankruptcy protection. Innkeepers USA filed for Chapter 11 bankruptcy protection in 2010, citing more than $1 billion in assets and liabilities.All but one of the 64 hotels will continue to be managed by Island Hospitality Management, a hotel management company that is 90 percent owned by Jeffrey H. Fisher, Chatham's chief executive officer and president.Chatham, a hotel real estate investment trust, and Cerberus, a New York-based private investment firm, agreed to buy the hotels in May for $1.13 billion.That deal fell apart, with Chatham and Cerberus deciding to pull out of the pact in August, citing an undisclosed condition, change or development that might have a material adverse impact on Innkeepers.But both sides reached a new pact, albeit one that has an overall lower value than the original deal. A bankruptcy judge overseeing Innkeepers' case approved the latest deal last Friday.Chatham owns about 10.3 percent interest in the joint venture that purchased the Innkeepers hotels and invested $37 million.All but one of the 64 hotels will continue to be managed by Island Hospitality Management, a hotel management company that is 90 percent owned by Jeffrey H. Fisher, Chatham's chief executive officer and president.

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