Westin Hotels Sold For $1.53b

Posted: October 28, 1987

Allegis Corp. completed the major portion of its $4 billion asset sale yesterday, announcing the sale of its Westin Hotel Co. division to Robert M. Bass Group and Aoki Corp. of Japan for $1.53 billion.

Allegis said $1.35 billion of the transaction would be in cash and the remainder in Westin debt assumed by the purchasing group, which is backed by the Industrial Bank of Japan.

Aoki is a medium-sized construction company that operates hotels in Brazil, Panama and Taiwan. It had total assets in March of 290 billion yen, or about $2 billion.

The Bass group, headed by reclusive financier Robert Bass, would provide no information. Bass participated in a $847 million buyout of Cincinnati-based Taft Broadcasting Co. in September.

With the sale of the Westin chain - with hotels in the United States, Canada and several other countries - Allegis is nearing completion of a major restructuring announced in June after a stormy change in the company's management and direction.

Shedding the Westin and Hilton International hotel and Hertz car-rental subsidiaries will free Allegis to concentrate on its once and future primary business - United Airlines.

Allegis plans to change its name to United Airlines Inc. after all the sales are completed, probably by the end of this year, officials said. The corporation had been known as UAL Inc. before adopting the name Allegis earlier this year.

Wall Street reacted to news of the Westin sale by sending Allegis shares $9.50 higher, to $71 at the close.

Analysts said the sales should allow Allegis to pay shareholders a special dividend of between $58.50 and $63.50 a share.

United's pilots union have offered to buy an 80 percent stake in the airline from Allegis for $5 billion, but Allegis management has rejected the union offier.

A pilot spokesman yesterday said the union's financial advisers, Lazard Freres, has advised union leaders to hold off their buyout efforts until the market's turbulence subsides and after Allegis completes its divestiture.

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