Leading global hospitality chain “Hilton” plans to invest $143 million in India

November 6, 2006	(Be the first to rate this story!)  Loading ...
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Leading global hospitality chain Hilton has penned a two-pronged strategy to check into the burgeoning hospitality market in India.

While on one hand Hilton is setting up a joint venture with KP Singh’s realty company DLF Ltd to build hotels, on the other hand it proposes to set up a wholly-owned subsidiary for operating these properties in India.

The JV, sources said, will develop and own hotels and serviced apartments under the Hilton, Hilton Garden Inn, Hilton Residences and Homewood Suites brands. The wholly-owned arm is being set up for operating these hotels and serviced
apartments.

In an application submitted to FIPB, Hilton International Co (HIC) has proposed to invest around $143 million over five to sebven years in the JV company to develop 50-75 hotels and serviced apartments across the country. Hilton has stated that the JV company will later be listed in the Indian stock exchanges.

HIC will initially hold 26% stake in the joint venture, while the remaining 74% will be with DLF. “HIC has proposed that it will continue to hold a minimum 26% stake in JV for seven years or until the new company’s IPO, whichever is earlier,” a source said.

The JV also intends to actively look at acquisitions at road to grow in the Indian market, the source said. Since Hilton has an existing tie-up with the Oberoi group and run hotels under the Trident Hilton and Hilton Towers brands, sources said HIC has decided not to own, develop or manage hotels under the brands that are committed to the Oberoi group.

Hilton is the latest global chain to look at expanding its presence in India and ride the boom in demand for hotel rooms. Paucity of hotel rooms has led to average rentals touching a high of around $350 in the national capital. In Bangalore, room rents have scaled past the $500-mark.

Source from Timesofindia.com

News Published Under:   Real Estate India |

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