Orient-Express Hotels rejected Tata Group’s unsolicited US$1.86 billion buyout offer and announced the appointment of a new president and CEO, John Scott.
Orient-Express Hotels said last month's buyout offer from Tata subsidiary Indian Hotels Co. significantly undervalues Orient-Express and its unique assets and is not in the best interests of Orient-Express and its shareholders.In a letter stating its decline of the offer mailed to Indian Hotels Co., Orient-Express wrote “your opportunistic proposal was made at a time when the price of Orient-Express shares has been significantly depressed. Orient-Express shares have been negatively impacted by various factors including economic turbulence, particularly in Europe, important properties in the midst of refurbishment projects, and the transition to a new CEO … many of our core properties are expected to achieve in 2012 substantially less than their peak EBITDA. In addition, we expect EBITDA to benefit materially as properties undergoing renovations reopen and major new properties commence operations. We are encouraged by the growth in our advance bookings for 2013, which are currently well ahead of last year at this time. In addition, the market value of our unique properties is underscored by the prices per key paid in some recent sales of iconic assets.”John Scott has been named president and CEO of Orient-Express Hotels. He replaces Philip Mengel, who served as interim CEO for the past six months. Mengel will continue to serve as a director on its board.
