After two unsuccessful attempts, Tata group hospitality chain Indian Hotels Company Ltd (IHCL) today said it would not pursue its USD 1.86 billion bid to acquire the Bermuda-based Orient Express Hotels.
On October 18, 2012, the IHCL board had approved making an offer to the Bermuda-based firm seeking their consent for IHCL, through its wholly-owned subsidiary, to acquire the outstanding 93.1 per cent Class A Common Shares of Orient-Express Hotels Ltd.
"...at a meeting of the Board of IHCL held on November 8, 2013, after taking into account all factors, the current economic environment as also other opportunities and priorities for the company, the Board of IHCL has decided not to pursue the afore mentioned transaction...," IHCL said in a BSE filing.
This offer was however rejected by Orient-Express Hotels Ltd, saying and even terming it as "unsolicited."
According to IHCL, Orient-Express Hotels had written to its board saying: "It was not an opportune moment for them to consider a sale of their company."
"...all contracts that were entered into to facilitate the bid, have all since been cancelled. An appropriate amended disclosure is being concurrently filed with the Securities Exchange Commission, USA," IHCL said.
Indian Hotels, along with Charme II Funds founded by the family of Ferrari Chairman Luca Montezemolo, had offered USD 12.63 per share in cash to acquire the outstanding 93.1 per cent stake in Orient-Express in October last year.
IHCL had even sought a meeting between Orient-Express Hotels Chairman J Robert Lovejoy with the then Tata group Chairman Ratan Tata alongwith Ferrari Chairman Luca Montezemolo to discuss the issue.
The takeover bid was the second by Indian Hotels, after an attempt in 2007 to increase its stake failed due to stiff opposition from the then Orient-Hotels management.