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International Hotel Investments yesterday announced that it reached an agreement with National Projects Holding Company which is a subsidiary of National Real Estate Company of Kuwait to establish a strategic partnership aimed at consolidating and growing IHI, a stock exchange listed company, through further hotel acquisitions.
The agreement is subject to certain approvals by the general meeting of IHI shareholders.
The agreement signed last Sunday states that IHI will issue two million shares to National Projects Holding.
Company at EUR1 each and at the same time granting the latter a six-month option expiring at the end of October 2006 to subscribe to a further 33million shares at EUR1 each.
The Company announcement posted on the stock exchange says that both NPHC and IHI aim to raise a further EUR75 million in equity by end May 2007 but at a price per share to be determined at the time.
The agreement is subject to the waiver of pre-emption rights by the current shareholders at the Annual General Meeting of IHI set for end May 2006.
Currently IHI has circa 3,400 private shareholders and Corinthia Palace Hotel Company Ltd which owns 78.59% of the 139 million shares on issue. This information is given in IHI's website.
The National Real Estate Company of Kuwait is listed on the Kuwait and Dubai Stock Exchange and with a market capitalisation of USD1.5 billion. It is a leading real estate company with multinational investments in large developments. From research carried out NREC has investments in the UAE, Lebanon, Tunisia, Pakistan, Libya and the USA. It is getting involved in other North African countries. Currently it manages the largest retail malls in Kuwait and has signed a strategic partnership with the Government of Jordan to develop and manage a two million square metre business park.
NREC was set up in the early 70s and during the three years ending 2003 shareholders’ profits grew by 600%. The company is active in real estate investments, management, construction, and also invests in quoted and unquoted companies.
The Board of IHI consider this stategic alliance as a bold commitment on the part of NREC to enter the Hotel sector using IHI as the vehicle.
Interestingly NREC owns a majority shareholding in PWC Logistics which is one of the world's largest logistics and warehousing companies with a turnover of USD8 billion.
The stock market reacted positively to this announcement and with IHI being the best traded equity yesterday with a 3.9 per cent increase. |
