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Italian PE fund backs Indian Hotels in $1.9b Orient-Express bid

  • Susannah Birkwood
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Montezemolo & Partners, an Italian family-owned private equity firm, and Indian Hotels (IH), India’s biggest accommodation provider, have launched a $1.86 billion takeover bid for Orient-Express Hotels (OEH), a Bermuda-based hotel chain.

The Italian fund manager is hoping to invest $100 million via its Charme II Fund for a minority stake in the New York Stock Exchange-listed company. Indian Hotels - which already holds 6.9% of Orient-Express - is proposing to purchase the remaining share capital.

IH and other entities affiliated with its owner, Mumbai-based conglomerate Tata Group, are proposing to pay $12.63 per share for the company, which equates to a 40% premium over Thursday's closing price. The transaction would be financed through a combination of equity and debt, with the latter having been secured from Bank of America, ICICI Bank and Standard Chartered Bank.

OEH owns New York's 21 Club and Rio de Janeiro's Copacabana Palace, while IH operates the Taj Mahal Palace in Mumbai and the Pierre Hotel in New York.

Earlier this week, French hospitality group Accor sold a 60% stake in Barque Hotels, the company that owns 15 Formule 1 hotels in India, to Samhi Investments. With this acquisition Samhi now has a total of 21 hotel projects, open or under development, across nine Indian cities.

 

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