The Blackstone Group agreed this afternoon to pay $26 billion to acquire the Beverly Hills-based Hilton Hotels Corp.

The price amounted to $47.50 per share, a 40 percent premium on the going market rate.

Blackstone already owns more than 100,000 hotel rooms in the United States and Europe, including the La Quinta Inns and Suite and LXR Luxury Resorts and Hotels.

"Our priority has always been to maximize shareholder value," said Hilton Co-Chairman Stephen F. Bollenbach. "We are delighted that a company with the resources and reputation of Blackstone fully appreciates the value inherent in our global presence, strong brands, industry leading marketing and technology programs, and unique portfolio of hotel properties."

Blackstone has been the world's largest private investor in hospitality for 15 years. The private equity firm has grown the La Quinta brand by approximately 45 percent since its acquisition in January 2006.

"It is hard to imagine a better strategic fit for us than Hilton with its world-class people, brands and network of hotels," said Jonathan Gray, senior managing director of Blackstone. "We are committed to investing in the company and working with Hilton's outstanding owners and franchisees to continue to grow and enhance the business."

Hilton Corp. is the largest global hospitality company, with nearly 3,000 hotels and 480,000 rooms in 76 countries and territories. Hilton's brands include Doubletree, Embassy Suites, Homewood Suites and Waldorf=Astoria.

The company was founded in 1919 when Conrad Hilton purchased his first hotel in Cisco, Tex.

Hilton's board approved the transaction today, which is expected to close during the fourth quarter of this year.

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