Sea Rock fuels Indian Hotels’ growth

Tata subsidiary Indian Hotels Company (IHCL) has acquired a controlling 85% stake in ELEL Hotels and Investments, a subsidiary of Delhi-based Claridges Hotels, which held a stake in the Sea Rock Hotel in Mumbai. The deal was valued at around US$140 million.

Amarchand Mangaldas represented IHCL on the deal. “The acquisition of ELEL was structured to comprise a direct acquisition through a primary issuance and transfer of equity shares of ELEL, and an indirect acquisition involving the purchase of two holding companies of ELEL,” the firm said in a statement.

Mumbai-based Kanga & Co advised the seller and its promoters on the sale. “The clients on both sides made it look really easy for the lawyers,” said Ashish Bhakta, a partner at the firm. “Professionalism was evident all around.”

IHCL plans to demolish the closed Sea Rock Hotel and redevelop the site into a multiuse hospitality zone. “This integrated development will be a powerhouse in hospitality in north Mumbai,” RK Krishna Kumar, vice-chairman of IHCL said during a press conference. “It will house a convention and hospitality centre with retail and commercial developments, and will be ready within five years.”

Kumar said the company had obtained the necessary approvals and that demolition of the existing structure was to start in July.

IHCL continues to expand its hospitality service offerings, having added approximately 1,200 rooms to its portfolio last year. It is poised to grow further this year with a new hotel scheduled for opening every month.

The company’s new hotels include the Falaknuma Palace in Hyderabad, the Taj in Cape Town, South Africa, as well as five Ginger Hotels (a chain of budget hotels in India). The Pierre (a Taj hotel in New York) held a soft launch on 1 June following a US$100 million renovation.