Investment team takes on $1.3b hotel loans.

Last week, Lehman Brothers Holdings Inc. and Starwood Hotels & Resorts announced a joint acquisition of a $1.3 billion senior debt in Le Meridien Hotels & Resorts, a United Kingdom-based hotel operator with properties throughout Europe, Asia and the Middle East.

Starwood, which has a profile similar to that of Le Meridien and operates such hotel chains as St. Regis, Sheraton and Westin, provided $200 million as a junior participator in the debt acquisition.

The hotel operator may or may not end up managing the newly acquired hospitality portfolio.

"At this point, it's just a financing," said Allison Reid, a spokesperson for Starwood Hotels & Resorts. "We entered into an agreement with Lehman to discuss a re-capitalization plan in the future."

According to Reid, Starwood may end up buying part of Le Meridien, but at the current moment no specific business plans exist.

"Our plan right now is to work with Lehman Brothers to see what makes the most sense," she said. "We have a responsibility to provide a return to our shareholders, so we need to look at the financing of the deal.

"Our discussions with Lehman will be ongoing over the next several months."

Le Meridien Hotels & Resorts owns approximately 120 hospitality properties throughout the world.

Its hotels generally cater to upscale clientele and are concentrated primarily in major European and Asian urban centers.