Fairmont Hotels & Resorts goes for $3.9 billion - East Valley Tribune: East Valley Local News

Fairmont Hotels & Resorts goes for $3.9 billion

Font Size:
Default font size
Larger font size

Posted: Tuesday, January 31, 2006 11:53 am | Updated: 3:11 pm, Fri Oct 7, 2011.

The Scottsdale Fairmont Princess Resort is poised to get a new royal owner and prestigious siblings. Just weeks after Fairmont Hotels & Resorts fended off takeover giant Carl Icahn’s bid to seize control, the company agreed to be bought by Kingdom Hotels International for an estimated $3.9 billion in cash.

Canadian-based Fairmont is parent of the 651-room Scottsdale resort and 87 other hotel properties.

As part of the deal announced Monday, Kingdom is partnering with Colony Capital, owner of the exclusive Raffles Hotels & Resorts, which includes 33 luxury properties in world capitals such as Singapore, Montreaux, Switzerland and also in Beverly Hills, Calif.

Kingdom and Capital plan to combine ownership of the two chains into a $5.5 billion hotel empire.

But the chains will retain their distinct management and monikers, Fairmont said.

Kingdom is owned by HRH Prince Alwaleed bin Talal bin Abdulaziz Alsaud of Saudi Arabia and his family.

Fairmont’s board has unanimously approved the purchase proposal, and is advising shareholders to OK the deal.

Shareholders would get $45 for their shares, a 2.7 percent premium over Friday’s $43.82 closing price.

If Fairmont shareholders OK the deal it is expected to close in the second quarter.

Just weeks ago, Fairmont’s board advised shareholders to reject Icahn’s $40 per share offer.

The Canadian company said previously it was exploring opportunities for selling itself or merging with another company.

“We are very excited about this transaction as it delivers value to our shareholders and creates an expanded foundation from which to build on our legacy, grow our brand and create significant opportunities for our employees,” Fairmont CEO William Fatt said Monday. “With an expanding international portfolio of exceptional resorts and gateway city properties, our guests will be exposed to new, exciting destinations with different cultures.”

Colony CEO Thomas Barrack Jr. said the deal would propel both brands into international lodging prominence. “Fairmont and Raffles are an excellent strategic fit with rich histories, global brand recognition and complementary destinations,” Barrack said in a statement. “Joining the two luxury companies creates an ideal platform for continued international expansion.”

A spokeswoman for the Fairmont Scottsdale Princess Resort could not comment Monday on how the purchase could affect local tourism business or whether the relationship with Raffles would drive more international business to the property.

  • Discuss


EastValleyTribune.com on Facebook


EastValleyTribune.com on Twitter


EastValleyTribune.com on Google+


Subscribe to EastValleyTribune.com via RSS

RSS Feeds

Your Az Jobs