Reply Mon 30 Jan, 2006 12:56 pm
Saudi Prince Alwaleed bin Talal's has agreed to rescue the fairmont hotels and assorted assets from american takeover-raider billionaire carl icahn.
so next time we are staying in toronto at the 'royal york hotel' (mrs h's favourite - she was groaning when i gave her the news), we'll probably be arriving by magic carpet .
what i find interesting that the kingdom hotel chain also owns an interest in many other hospitality related businesses, including the swiss 'moevenpick' chain.
i better bone up on arabic - saalem aleikum (?) . hbg


Monday, January 30, 2006

Globe and Mail Update

Fairmont Hotels & Resorts Inc. agreed to be acquired for $3.9-billion (U.S.) by Saudi Prince Alwaleed bin Talal's Kingdom Hotels International and investment firm Colony Capital Inc., thwarting a takeover attempt by U.S. billionaire investor Carl Icahn.

The transaction values the Toronto owner of the Delta Hotels chain at $45 a share, $5 more than Mr. Icahn's bid in December. Fairmont's board unanimously approved the Saudi offer and continues to recommend shareholders reject Mr. Icahn's offer.

If successful, Prince Alwaleed plans to combine Fairmont and Singapore-based chain Raffles, creating a luxury global hotel leader with 120 hotels in 24 countries. Fairmont would continue to remain an independent hotel management company with headquarters in Canada. The prince already owns 3.9 million Fairmont shares.

"As one of Fairmont's current shareholders and strategic partners, Kingdom has long recognized the Company's existing value and potential," Prince Alwaleed said in a statement. "We look forward to partnering with Colony and working with both Fairmont and Raffles' management to take the combined companies to a new level of achievement."

Fairmont shares rose 16 cents to $50.60 (Canadian) in Toronto and 34 cents to $44.16 (U.S.) in New York after the announcement.

"With an expanding international portfolio of exceptional resorts and gateway city properties, our guests will be exposed to new, exciting destinations with different cultures," said William Fatt, Fairmont's chief executive Officer.

At $45 a share, the buyers are paying about $3.26-billion for Fairmont. The over-all value of $3.9-billion includes debt.

The total value of the complete transaction, including the combination with Raffles, is about $5.5-billion. Raffles owns and manages a portfolio of 33 properties located primarily across Asia and Europe, including its flagship property built in 1887, the Raffles Hotel, Singapore.

Thomas Barrack, Jr., chief executive of Colony called Fairmont and Raffles "an excellent strategic fit with rich histories, global brand recognition and complementary destinations."

The transaction is subject to the approval of 662/3 per cent of the votes cast by Fairmont's shareholders at a meeting of shareholders, expected to take place in April, as well as court approval. The proposed transaction is expected to close in the second quarter of 2006, shortly after receipt of shareholder and court approvals.

Prince Alwaleed bin Talal bin Addulaziz Alsaud is one of the world's richest people. Buying Fairmont would add to the investing empire of Prince Alwaleed who has once had or currently maintains stakes in London's Savoy Hotel, New York's Plaza Hotel and Geneva's Hotel des Bergues, according to the Wall Street Journal.

Fairmont's holdings include 87 luxury properties with about 34,000 guestrooms in the U.S., Canada, Mexico, Bermuda, Barbados, United Kingdom, Monaco, Kenya and the United Arab Emirates. It owns Fairmont Hotels Inc., which calls itself North America's largest luxury-hotel management company. It also owns the Delta Hotels chain in Canada.

Kingdom is owned by Prince Alwaleed and his family, who have invested in banking, hotels, media, telecommunications, technology, construction and real estate, entertainment, and fashion. He also holds interests in Four Seasons Hotels and Resorts and Movenpick Hotels & Resorts, along with Citigroup, News Corp., Time Warner, Apple Computers, Canary Wharf and Disneyland Paris.

Colony Capital is a private, international investment firm focusing primarily on real estate-related assets and operating companies. If this transaction is completed, it will have invested more than $20-billion in over 8,000 assets.

© The Globe and Mail
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