25th Jan 2006 12:11
InterContinental Hotels Group PLC25 January 2006 INTERCONTINENTAL HOTELS GROUP RENEGOTIATION OF MANAGEMENT AGREEMENT WITH FELCOR LODGING TRUST; PURCHASE OF HOTELS BY HOSPITALITY PROPERTIES TRUST (LONDON) 25 January 2005-InterContinental Hotels Group PLC ("IHG") todayannounces a restructured management agreement with FelCor Lodging Trust Inc ("FCH"), covering all of the hotels (15,790 rooms) owned by FCH and managed byIHG. This new agreement extends the terms of IHG's contracts, rebases incentive feepayments and deploys capital investment in key hotels to drive value for FCH andIHG. Key highlights are: • 17 hotels (6,301 rooms) will be retained by FCH and managed by IHG, with revised contract terms (duration extended to 2025) and rebased incentive fees on all the hotels. Additionally, 11 of the 17 hotels will receive additional capital investment from FCH totalling some $50m. • Hospitality Properties Trust ("HPT") have purchased seven (2,072 rooms) of the hotels from FCH for $160m, retaining the IHG flag on these assets. There is no increase in IHG's corporate guarantees to HPT as a result of this deal. Separately, IHG have sold the Staybridge Suites, Las Colinas, USA, to HPT. IHG have also agreed to sell the Holiday Inn, Montego Bay, Jamaica to HPT subject to final due diligence. The combined sales price of $35m for these two assets is marginally below the combined net book value of the assets. • Nine further hotels (2,463 rooms) can be sold by FCH, retaining an IHG brand. • FCH has the right to sell or convert a further 15 hotels (4,954 rooms); these may retain the IHG flag. Andrew Cosslett, Chief Executive, IHG commented: "Agreeing this deal with FelCoris a big step forward. It improves the quality of our brand distribution andlays out clear performance criteria for both parties. We are also very happy todeepen our long-standing relationship with HPT. We look forward to continuingour successful partnership with both companies to grow our brands still further." "We are pleased that we found a solution with IHG that meets both our strategicobjectives," said Thomas J. Corcoran, Jr., FelCor's President and CEO. For further information, please contact: Investor Relations (Gavin Flynn/Paul Edgecliffe-Johnson): +44 (0) 1753 410 176 +44 (0) 7808 098 972Media Affairs (Leslie McGibbon): +44 (0) 1753 410 425 +44 (0) 7808 094 471 Note to Editors: InterContinental Hotels Group PLC of the United Kingdom (LON:IHG, NYSE:IHG(ADRs)) is the world's largest hotel group by number of rooms. InterContinentalHotels Group owns, manages, leases or franchises, through various subsidiaries,almost 3,600 hotels and 539,000 guest rooms in nearly 100 countries andterritories around the world. The Group owns a portfolio of well recognised andrespected hotel brands including InterContinental(R) Hotels & Resorts, CrownePlaza(R) Hotels & Resorts, Holiday Inn(R) Hotels and Resorts, Holiday InnExpress(R), Staybridge Suites(R), Candlewood Suites(R) and Hotel IndigoTM, andalso manages the world's largest hotel loyalty programme, Priority Club(R)Rewards, with over 26 million members worldwide. InterContinental Hotels Group offers information and online reservations for allits hotel brands at www.ichotelsgroup.com and information for the Priority ClubRewards programme at www.priorityclub.com. For the latest news from InterContinental Hotels Group, visit our online PressOffice at www.ihgplc.com/media. Cautionary note regarding forward-looking statements This announcement contains certain forward-looking statements as defined underUS law (Section 21E of the Securities Exchange Act of 1934). Theseforward-looking statements can be identified by the fact that they do not relateto historical or current facts. Forward-looking statements often use words suchas ' target', 'expect', 'intend', 'believe' or other words of similar meaning.By their nature, forward-looking statements are inherently predictive,speculative and involve risk and uncertainty. There are a number of factors thatcould cause actual results and developments to differ materially from thoseexpressed in or implied by such forward-looking statements. Factors that couldaffect the business and the financial results are described in "Risk Factors" inthe InterContinental Hotels Group PLC Annual Report on Form 20-F filed with theUnited States Securities and Exchange Commission. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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