[photopress:Shangri_la_hotel.jpg,full,alignright]Shangri-La Asia, the hotel arm of Malaysia’s Kuok Group, plans to raise at least $662 million via a rights issue to pay back debt and fund expansion plans in China’s booming world of hotels.
Shangri-La, Asia’s largest listed hotel chain by market value and controlled by billionaire Robert Kuok, runs 19 hotels across China and intends to double that number by 2010.
It said it would issue between 287.2 million to 290.1 million rights shares. Shareholders will get one rights share for every nine shares held. Trading in shares of the hotel operator had been suspended since June 29, pending details of the issue.
Last year, Shangri-La teamed up with Kerry Properties and Allgreen Properties to develop a site in China’s northern city of Tianjin into commercial, office and residential property.
The move by the hotel chain — named after the mythical utopia made famous by British author James Hilton — is part of a general heating up in this area which was hardly luke-warm to start with.
U.S. private equity firm Blackstone Group will buy Hilton Hotels for about $26 billion in cash — the richest in a series of recent private equity offers for hoteliers. And, before you ask, yes, Paris Hilton gets a slab of that. Possibly to spend on mental and physical recovery treatments after her short spell in the slammer.
Accor, Europe’s largest hotelier, expects to double the revenue it takes from Asia in three or four years by following its plan to expand across China. The firm hopes to have as many as 160 hotels in operation or under development across the country by 2010, up 55% from the current 103.
InterContinental intends that half of the 50,000 to 60,000 rooms it plans to build globally by 2008 will be in China — in time to benefit from an anticipated tourism boom during the Olympic Games.