Mumbai-based Indian Hotels Company, better known for its Taj group of hotels,
has bought a 10 per cent stake in Orient-Express Hotels Ltd. for $211 million
(about Rs850 crore). The acquisition is being done through IHC''s wholly owned
subsidiary Samsara Properties Ltd.
Orient-Express owns or part-owns and manages 49 businesses operating in 25 countries.
hotels on five continents, including Hotel Cipriani in Venice, the Mount Nelson
in Cape Town, the Copacabana Palace in Rio de Janeiro and the Observatory in Sydney;
restaurants; ''21'' Club in New York and La Cabaña in Buenos Aires;
tourist trains, include the legendary Venice Simplon-Orient-Express in Europe,
The Eastern & Oriental Express in South East Asia and The Royal Scotsman;
and (part-owns and manages) PeruRail in Peru.
cruises in Burma and France.
of the Orient-Express stake is said to be a part of a $1.5-billion thrust by the
Tata Group-owned Indian Hotels to expand globally. Earlier this year the Indian
company completed its takeover of Ritz-Carlton hotel in Boston for $170 million.
Indian Hotels, India''s biggest hotel chain, is looking at Orient-Express as
a partner in this expansion drive. It is in continuing discussions with Orient-Express
for building the alliance, and may further increase its stake in that company.
in September the group''s Taj Hotels Resorts and Palaces and Okura Hotels &
Resorts, a major international hotel group in Japan, signed a strategic joint
marketing agreement to develop cross-promotional opportunities for both companies
to harness each other''s strengths in their respective markets of dominance.
is part of Indian Hotels'' strategy to strike alliances with leading hotel groups
that do not have a presence in India but have a presence in other countries.
Hotels has plans to borrow up to Rs.4,000 crore and raise over Rs.1,900 crore
through a rights issue. These funds will be used to fund expansion and acquisition
of properties. Revenues from global operations are projected to rise to a third
from the current level of 20 per cent.
2005 the Taj group has acquired the W Sydney hotel in Woolloomooloo, Sydney, the
Ritz Carlton in Boston and Campton Place in San Francisco. It has also taken over
the management of The Pierre in New York.
Hotels was founded in 1976 with the purchase of Hotel Cipriani in Venice, as the
leisure division of Sea Containers Ltd and was later incorporated as Orient-Express
Hotels Ltd., a Bermuda company.
Hotels Ltd was floated on the New York Stock Exchange in August, 2000 and Sea
Containers sold the last of its shareholding in November 2005. In 2006, the last
full year for which figures are available, Orient-Express Hotels had net earnings
of $39.8 million on revenue of $510.5 million.