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Indian Hotels offer to buy the Orient-Express luxury brand is met with a "no"
Orient-Express Hotels Group has turned down the surprise buyout offer from Tata Groups’, Indian Hotels Company, saying the proposed $1.2 billion price tag was not enough and came at an inappropriate time.
Though Orient-Express said they would take three weeks to decide, they made the decision earlier, stating, The Indian Hotels proposal “..is deeply unattractive from a financial perspective," said Orient-Express Chairman Robert Lovejoy. Further, "The board believes the current macroeconomic environment, conditions in the luxury hotel business and factors unique to Orient-Express would make this a highly disadvantageous time to sell the company to realize its true value."
Indian Hotels’ initial offer was $12.63 a share for stocks (a 40% premium). Meanwhile OEH closed yesterday at $10.55 a share.
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Will the Orient-Express hotels in Cusco keep their names? In three weeks we'll know for sure
This news appeared in our inbox this weekend from an unknown source and we weren’t sure whether it was fact or fiction. Orient-Express Hotels up for sale? Really? Trouble in paradise?
Add the news that the unsolicited all cash offer from Tata Group’s Indian Hotels of $12.63 Per Share (a 40% premium on that day’s closing share price), was a tad on the bold side and we were even more uneasy--why go so high? Yet that would mean a cool $1.86 billion sale for Orient-Express. At least they're getting a higher bid, unlike the discount Jetsetter.com had to offer for its company sale.
Subsequent news briefs confirmed the proposal was definitely real, bold, and that U.S.-listed Orient-Express Hotels Ltd., while in $615.6 million debt wasn't seeking bailout. However, in a statement the company said it will evaluate the proposal carefully and respond in due course in accordance with the best interests of the Orient-Express Hotels Ltd. and its shareholders.