Saudi billionaire puts Mövenpick resort up for sale
PHUKET: The 362-room Mövenpick Resort & Spa in Karon is up for sale, one of several hotels in Saudi billionaire Prince Alwaleed bin Talal’s property portfolio that have been put on the block in recent months.
Thursday 9 February 2012, 12:35PM
Nihat Ercan of Jones Lang LaSalle Hotels in Singapore, which is handling the sale, told The Phuket News, “There is no asking price as such. The market will determine where the price will be.
“But we expect it to be at least B3.2 billion.
“This is one of Phuket’s landmark resorts. It’s on Phuket’s second-best-known beach, it is highly accessible and it has significant land holdings.”
In the last quarter of 2011, Prince Alwaleed’s Kingdom Hotel Investments (KHI) sold off its stakes in the Four Seasons Hotel Jakarta and the Mövenpick Dar es Salaam in Tanzania.
Those sales put US$93 million (B2.8 billion) into the KHI coffers, and the sale of the Mövenpick in Karon should add a much more significant lump to the company’s cash holdings.
The Saudi newspaper Arab News quoted the Prince as saying, “These transactions mark yet another step for KHI towards the realisation of the value of its investments.”
Sarmad Zok, chairman and CEO of Dubai-based KHI, and a board member of parent company, Kingdom Holding Co, was quoted by the newspaper as saying, “We are delighted to realise value from our investments.
“Whereas M&A transaction volumes have been thin globally, KHI’s active monetisation program is a testimony to the quality of its assets and team execution.”
Neither mentioned that KHI has been hit by the “Arab Spring” revolutions across the Middle East.
In the fourth quarter of 2011, according to financial news service Bloomberg, profit declined 20 per cent, falling to US$50 million (B1.5 billion) from US$63 million (B1.89 billion) a year earlier.
Local commentator Bill Barnett, in his blog, The Phuket Insider, said, “JLLH … have said they are receiving a high level of interest in the resort.”
The resort began life as the Karon Villa and Royal Wing, owned by the Vanich family. I
In December 2003 it was sold to LaSalle Investment Management, which spent US$20 million (B600 million)on an extensive makeover.
InterContinental brand subsidiary Crowne Plaza was contracted to run the property.
KHI bought the resort in May 2006 for US$98.5 million (at the time about B3.7 billion), assigning Mövenpick to manage the property.
Although the expected minimum price this time is lower than the B3.7 billion KHI paid for the resort, KHI will have already made significant gains from the villas and apartments it built at the resort and sold to private buyers.