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Rediff News  All News  » Business » Indian Hotel buys 10% in Orient-Express

Indian Hotel buys 10% in Orient-Express

September 18, 2007 03:06 IST

Indian Hotel Company (IHCL), the owner of the Taj chain of hotels, has acquired a 10 per cent stake in the NYSE-listed Orient-Express Hotels for nearly Rs 850 crore through open market operations.

This acquisition may be a precursor to an association with Orient-Express, which owns or part-owns and manages 35 hotels in 25 countries.

The Tata group company has also written a letter to James B Hurlock, chairman of the Orient-Express board, seeking an appointment to discuss a possible alliance with the company.

IHCL Vice-Chairman R K Krishna Kumar said: "This move is in line with our plans to grow the Taj brand internationally and we look forward to pursuing a possible association between IHCL and Orient-Express Hotels. Over the past few years, we have been pursuing alliances and relationships with leading hotel groups that have not yet set up their presence in India, but have secured leadership positions in various geographies."

Sources in the know of the development said IHCL might scale up its stake in Orient-Express, depending on the outcome of the meeting. Samsara Properties, an IHCL subsidiary which has bought the shares of Orient-Express, has borrowed enough funds to scale up holding.

Orient-Express has announced realigning its management structure "to serve the needs of the business as it pursues its expansion plans", the company said in a Press release. Last month, the company appointed Paul White as president and CEO of Orient-Express.

The Indian Hotels share closed 0.78 per cent higher at Rs 129.65 on the Bombay Stock Exchange today.

BS Reporter in Mumbai