RIYADH, 13 May 2006 — Kingdom Hotels International (KHI) has completed a $5.5 billion acquisition deal of Fairmont Hotels & Resorts Inc.
According to an announcement, a Canadian company owned two-thirds by affiliates of KHI and one-third by Colony Capital Acquisitions, acquired all of Fairmont’s outstanding common shares at a price of $45 per share in cash for each Fairmont common share held.
Fairmont Hotels and Resorts shareholders gave a 98.6 percent vote of approval for the acquisition deal. With the completion of the transaction, the Fairmont and Raffles’ portfolios will now be combined, transforming the companies into a global hotel leader headquartered in Toronto, with 120 hotels in 23 countries under four brands - Fairmont, Raffles, Swissotel and Delta.
“We’re very excited about this transaction as it creates an expanded foundation from which to build on our legacy, grow our brand and create significant opportunities for our employees. With an expanding global portfolio of exceptional resorts and gateway city properties, our guests will be exposed to new, exciting destinations with different cultures,” said William R. Fatt, Fairmont’s chief executive officer. “We look forward to working with our partners who are committed to building on the success of our Company.”
Prince Alwaleed bin Talal, chairman of Kingdom Holding, said: “As a long time investor in Fairmont, Kingdom has recognized the company’s value and potential, which is attributable to the dedication and professionalism of its management and employees. We look forward to working with Colony to build on the success of these brands and to further expand this irreplaceable collection of properties around the world.”
“Our partnership with Prince Alwaleed in this global hotel company fulfills our mission to invest with world class partners in irreplaceable assets with proven management teams,” Thomas J. Barrack, Jr., chairman and chief executive officer of Colony, said. “Fairmont and Raffles are an excellent strategic fit with rich histories, creating a brand-focused company with an expansive global footprint that is dedicated to serve as the destination of choice for the world’s most discriminating travelers.”
The purchaser’s tender offer for Fairmont’s outstanding 3.75 percent convertible senior notes due 2023 expired at 5 p.m. EST on Wednesday (May 10). The purchaser has advised Fairmont that, at the closing of the tender offer, $267 million aggregate principal amount, or approximately 99 percent, of the $270 million aggregate principal amount of issued and outstanding notes had been tendered for purchase. Fairmont intends to satisfy any conversion on the remaining outstanding notes by way of a cash payment.
