Paulson & Co., Centerbridge Partners and Blackstone Group won a bankruptcy auction for hotel chain Extended Stay Inc. with a $3.9 billion bid, two people familiar with the matter said.
Extended Stay, which filed for bankruptcy last June, selected the proposal over a rival bid from Starwood Capital Group and TPG Capital after an all-night auction, the people said yesterday.
The two groups were competing for months to invest in Extended Stay and its portfolio of more than 600 hotels. The auction began at 10 a.m. Thursday and ended at about 5 a.m. yesterday after numerous rounds of bidding, the people said.
About 200 individuals representing the bidders and Extended Stay’s creditors attended the auction, one of the people said.
The $3.9 billion investment, which requires court approval, will give Centerbridge, Paulson and Blackstone 100 percent of the equity in Extended Stay when it emerges from bankruptcy protection, the person said. An earlier agreement called for the company’s senior lenders and investors to each receive equity stakes, according to court documents.