MUMBAI: Gurgaon-based DLF group and overseas giant Hilton have struck a deal to set up a chain of hotels across the country for an estimated investment of Rs 10,000-12,000 crore, people close to the transaction said. DLF will hold 74% in the JV with Hilton holding the rest. The foreign chain will have the option of increasing its stake to 49% after some years.
The deliberations, which were on for the past few months, have finally ended in a workable plan and the deal is expected to be announced in the next few days, sources say.
“The talks are at a very advanced stage,” DLF vice-chairman Rajiv Singh told ET. “We are exploring opportunities for strategic partnerships with leading developers globally and India specifically,” Faith Thoms, director communication, Hilton International, Middle East & Asia Pacific, told ET from Singapore. She added that it was too premature for details.
The JV with one of the most popular hotel chains in the world will help DLF utilise its vast land bank better, while Hilton will gain from the ready availability of prime land across the country in DLF’s possession.
India is a key growth market for the hospitality major and one in which the chain is very keen on significant expansion, Ms Thoms said. “Following the merger of Hilton Hotels Corporation with Hilton Group Plc in February ‘06, Hilton Hotels Corporation has a diverse portfolio of leading brands that extend from the luxury segment to business and focused-service hotels that we intend to launch internationally and adapt in key markets worldwide,” she added.
If DLF’s hospitality plans, which include a presence through the five-star, resort, business and budget category spread over 25,000 rooms in five years comes through, Hilton’s presence in the country, would be substantially strengthened. In April ‘04, Hilton International signed a strategic alliance with EIH Limited, giving the company presence in eight locations across India; seven of which was under the Trident Hilton brand and the eighth being Hilton Towers in Mumbai.
EIH manages all the hotels while Hilton is responsible for international marketing, promotion and reservations through the Hilton global network. While Trident Hilton Mumbai, a 500-room new property in north Mumbai, is scheduled to open next year, Hilton also has management contracts for three properties.
According to the arrangement that is being worked out, DLF would carry out the construction work and develop the hotel, with the day-to-day operations managed by Hilton. “We want to be principally the owners of the hotel assets because that is the business we are in at present. Hotel operating skills are a different game altogether,” DLF vice-chairman Rajiv Singh had said in July.
With much of the land already in the DLF kitty, the first hotel from the JV is most likely to be in the business sector, which is projected to grow 4% in the next couple of years.
source : ET
DLF, which will hold 74% in the JV, will be able to use its vast land bank effectively, riding on Hilton’s brand name and expertise.
If DLF’s hospitality plans, which include a presence through the five-star, resort, business and budget category spread over 25,000 rooms in five years comes through, Hilton’s presence in the country, would be substantially strengthened.
If DLF’s hospitality plans, which include a presence through the five-star, resort, business and budget category spread over 25,000 rooms in five years comes through, Hilton’s presence in the country, would be substantially strengthened.
The deliberations, which were on for the past few months, have finally ended in a workable plan and the deal is expected to be announced in the next few days, sources say.
“The talks are at a very advanced stage,” DLF vice-chairman Rajiv Singh told ET. “We are exploring opportunities for strategic partnerships with leading developers globally and India specifically,” Faith Thoms, director communication, Hilton International, Middle East & Asia Pacific, told ET from Singapore. She added that it was too premature for details.
The JV with one of the most popular hotel chains in the world will help DLF utilise its vast land bank better, while Hilton will gain from the ready availability of prime land across the country in DLF’s possession.
India is a key growth market for the hospitality major and one in which the chain is very keen on significant expansion, Ms Thoms said. “Following the merger of Hilton Hotels Corporation with Hilton Group Plc in February ‘06, Hilton Hotels Corporation has a diverse portfolio of leading brands that extend from the luxury segment to business and focused-service hotels that we intend to launch internationally and adapt in key markets worldwide,” she added.
If DLF’s hospitality plans, which include a presence through the five-star, resort, business and budget category spread over 25,000 rooms in five years comes through, Hilton’s presence in the country, would be substantially strengthened. In April ‘04, Hilton International signed a strategic alliance with EIH Limited, giving the company presence in eight locations across India; seven of which was under the Trident Hilton brand and the eighth being Hilton Towers in Mumbai.
EIH manages all the hotels while Hilton is responsible for international marketing, promotion and reservations through the Hilton global network. While Trident Hilton Mumbai, a 500-room new property in north Mumbai, is scheduled to open next year, Hilton also has management contracts for three properties.
According to the arrangement that is being worked out, DLF would carry out the construction work and develop the hotel, with the day-to-day operations managed by Hilton. “We want to be principally the owners of the hotel assets because that is the business we are in at present. Hotel operating skills are a different game altogether,” DLF vice-chairman Rajiv Singh had said in July.
With much of the land already in the DLF kitty, the first hotel from the JV is most likely to be in the business sector, which is projected to grow 4% in the next couple of years.
source : ET