Indian firm makes 1.86 bln offer for hotel chain
NEW DELHI - Agence France-Presse
A couple have lunch in a restaurant of an Indian Hotels branch in New Delhi. REUTERS photoIndian Hotels, an arm of the giant Tata Group, announced on Oct. 18 an offer worth $1.86 billion to acquire Orient-Express Hotels, marking its second attempt to buy the Bermuda-based luxury global chain.
Indian Hotels Co Ltd along with Charme II Fund, an Italian private equity fund managed by Montezemolo and Partners SpA, have sent a letter to Orient-Express Hotels Ltd proposing the purchase, the Indian company said in statement.
“We are very excited at the prospect of bringing our two great companies and brands together,” R.K. Krishna Kumar, vice chairman of Indian Hotels, said in the statement.
Taj hotel chain
In 2007, Orient-Express spurned an offer by Indian Hotels for a tie-up on the grounds that its brand value might be diluted by an association with the Indian company which owns the premium Taj hotel chain in India and abroad.
The rebuff by the U.S.-listed Orient-Express chain outraged Indian business and prompted demands for an apology from the tea-to-steel Taj Group, one of the oldest business houses in India.
Indian Hotels said it had already acquired a 6.9-percent stake in Orient-Express and now was proposing to buy the remaining 93.1 percent in an all-cash offer.
Combining with the US-listed Orient-Express is a “strategically compelling opportunity” for both companies as well as for their respective shareholders, Indian Hotels said.
The $12.63-per-share bid for Orient-Express, based in Hamilton, Bermuda, represents a 40-percent premium to the company’s share price before the offer was made public, Indian Hotels said in the statement.