DLF PLANS TO EXIT AMANRESORTS

Normal 0 false false false EN-US X-NONE X-NONE MicrosoftInternetExplorer4 st1:*{behavior:url(#ieooui) } /* Style Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:""; mso-padding-alt:0in 5.4pt 0in 5.4pt; mso-para-margin:0in; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:11.0pt; font-family:"Calibri","sans-serif"; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:"Times New Roman"; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin; mso-bidi-font-family:"Times New Roman"; mso-bidi-theme-font:minor-bidi;} DLFplans to exit international luxury resort chain Amanresorts less than two yearsafter the country’s largestreal estate company acquired a 50% stake the Singapore-based hotel chain. DLFhas held preliminary talks with at least two Indian hotel chains to sell off ordilute its stake in Amanresorts, but a huge gap between its expectation andwhat the buyers are willing to pay is holding up the talks, three industryexecutives close to the development told ET. “Thereis surely an interest among potentialbuyers …but their offer price is too low compared with the price we had paidfor Aman in 2007,” said a senior DLF executive, who asked not to be named. He didnot name any company that has shown interest, but two hotel industry executivessaid DLF has held preliminary talks with ITC Hotels. Boththe companies denied the development. A DLF spokesman said the company had noplans to dilute equity or sell any property of Amanresorts, whilean ITC spokesman denied any interest in the international chain. DLF may alsoconsider hiving off Aman properties in Alwar in Rajasthan and two loss-makingproperties in Sri Lanka to some investors or hotel chain without the Aman brand, said an industryexecutive requesting anonymity. Amanresortsopened his first hotel, Amanpuri, in 1988 at Phuket , Thailand .Today it has 23 small luxuryresorts across the world, including three in India . It is rated highly byinternational hotel rating agencies such as Condé Nast Traveler and ZagatSurvey. DLF acquired 50% in Amanresorts in 2007 in a deal estimated between$200 and $250 million and signed a definitive agreement with Adrian Zecha,founder and chairman of Amanresorts, to acquire a controlling interest in thegroup. Thatmeans DLF may not be able to exit the company without the consent of Mr Zecha,who could not be contacted for this story. In the past, while announcingcompany’s falling interest in the hotel business, DLF vice chairman Rajiv Singhhad said that the company wanted to retain Aman as it was a boutique brand. Accordingto executives, the company may have changed its mind because of its increasingcash needs and also considering that luxury hotels around the world have beenstruggling for more than a year now with the global economic recession taking atoll on business and leisure travel. DLF has targeted to raise Rs 5,500 croreby selling assets and exiting businesses such as wind power and townshipprojects in Dankuni, West Bengal and Bidadi,Karnataka, as it struggles to deal with the sudden fall in demand for homes ,offices and shops in the wake of the global downturn. It hasalready sold its small hotel project in Saket, Delhi . It has put on the block over 10 hotelplots across the country, including in Gurgaon and Mumbai. Backin 2007 when realty boom was at its peak, DLF had plans to get into the hotelbusiness in a big way. Besides buying Amanresorts, it announced plans to buildaround 75 hotels in India in a joint venture with international hotel chain Hilton. But after Hilton wastaken over by private equity company Blackstone, the two partners scaled downtheir ambition to just four properties. Courtesy:-ET dt: - 21 st Sep. 2009      

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