EIH Ltd has announced that the Board of Directors of the Company at its meeting held on May 05, 2010, has approved the acquisition of the 45.85% equity interest of Amex Investment Ltd, Hongkong (“Amex”) in its international hotel joint venture company. EIH Holdings Ltd British Virgin Islands for US$45 million. The acquisition will be undertaken by EIH Ltd, through its wholly owned subsidiary EIH International Ltd, British Virgin Islands.
A letter of intent for the acquisition has been signed with the principal shareholder of Amex. The proposed transaction is subject to a number of conditions including mutual agreement of the formal transaction documents and applicable regulatory approvals.
The joint venture currently has the business interests in Hotel Investments and Hotel Management Contracts. The JV has equity investments in existing Oberoi hotels in Mauritius, Bali Indonesia, Lombok Indonesia and Sahl Hasheesh Egypt. The JV has Long term hotel management contracts for each of those hotels in which it has invested as well for The Oberoi Zahra, Nile Cruiser in Egypt, in which there is no investment. The JV also has Long term hotel management contracts for new Oberoi hotel projects under construction or under planning in Dubai, Marrakech Morocco, Greece and a second hotel in Mauritius.
As a result of the proposed acquisition, these assets will be entirely owned by EIH Ltd through its subsidiary EIH International Ltd.
EIH Holdings Ltd will enter into new long term global licensing agreement under which it will have exclusive rights to use the “Oberoi” and “Trident” brands throughout the world other than in India where EIH Ltd has been licensed on a similar basis for many years.
Source: Equity Bulls