Starwood 2005 Annual Report Download - page 84

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STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
AND STARWOOD HOTELS & RESORTS
NOTES TO FINANCIAL STATEMENTS Ì (Continued)
Note 4. SigniÑcant Acquisitions
Acquisition of Le M πeridien. In November 2005, the Company acquired the Le Mπeridien brand and the
related management and franchise business for the portfolio of 122 hotels and resorts. The purchase price of
approximately $225 million was funded from available cash and the return of the original Le Mπeridien
investment. The Company has accounted for this acquisition under the purchase method in accordance with
SFAS No. 141, ""Business Combinations,'' and has preliminarily allocated $186 million of the purchase price
to goodwill with the remainder assigned to the estimated fair value of the assets acquired and liabilities
assumed of the Le Mπeridien brand.
Recapitalization of the Joint Venture that Owns the Sheraton Imperial Hotel. In August 2005, the
Company provided a $30 million loan related to the recapitalization of the joint venture that owns the
Sheraton Imperial Hotel in Kuala Lumpur, Malaysia. The Company has a 49% ownership interest in the joint
venture.
Acquisition of the Remaining Interest in PT Indo-PaciÑc Sheraton. In August 2005, the Company
acquired the remaining 55% ownership interest in PT Indo-PaciÑc Sheraton (""IPS'') for approximately
$12 million. IPS is an Indonesian management company that has the exclusive right to manage all Sheraton
hotels in Indonesia. IPS currently manages ten properties. Prior to August 2005, the Company owned 45% of
IPS.
Acquisition of Sheraton Kauai Resort. In March 2004, the Company acquired the 413-room Sheraton
Kauai Resort on Poipu Beach in Kauai, Hawaii. The purchase price for the property was approximately
$40 million and was funded from available cash. Prior to the acquisition, the Company managed the property
for the former owner.
Tender OÅer to Acquire Partnership Units of Westin Hotels Limited Partnership. In the fourth quarter
of 2003, the Company commenced a tender oÅer to acquire any and all of the outstanding limited partnership
units of Westin Hotels Limited Partnership, the entity that indirectly owned the Westin Michigan Avenue
Hotel in Chicago, Illinois, one of the Company's managed hotels. The tender oÅer expired on February 20,
2004 and approximately 34,000 units were tendered to the Company and accepted for payment, representing
approximately 25% of the outstanding units. The purchase price of approximately $26 million was funded from
available cash. In January 2005, the Westin Michigan Avenue Hotel was sold and the Company received
proceeds of approximately $27 million.
Acquisition of Bliss World LLC. In January 2004, the Company acquired a 95% interest in Bliss World
LLC which, at the time of the acquisition, operated three stand alone spas (two in New York, New York and
one in London, England) and a beauty products business with distribution through its own internet site and
catalogue as well as through third party retail stores. The aggregate purchase price for the acquired interest
was approximately $25 million and was funded from available cash. The Company recorded approximately
$22 million in goodwill associated with this acquisition. In 2005, the Company acquired the remaining 5%
interest for approximately $1 million.
F-21