Luxury goods conglomerate Moët Hennessy-Louis Vuitton (LVMH) has signed a deal with Orascom Development Holdings (ODH) to build two luxury hotels in the Middle East.

The partnership will see two resorts - one located off Oman and the other on the Nile, Egypt - open in 2012, as LVMH looks to expand in the luxury travel sector.

Both properties will operate under the Cheval Blanc brand.

Under the terms of the arrangement, the construction of the properties will be largely financed by ODH, while LVMH will run the hotels when complete, and subsequently take a percentage of sales and profits.

The Maison Cheval Blanc in Oman will sit on the 11 square-kilometre island of Al Sodah and include 32 private villas, while the Egyptian development is on the private island of Amoun in Aswan.

This second luxury hotel will include about 40 suites overlooking the Nile, the company said.

Cheval Blanc

Management of the two properties will be undertaken by the LVMH Cheval Blanc unit, named after the group’s Michelin-starred hotel in the Alpine resort of Courchevel.

The Courchevel property opened in 2006, with LVMH calling the latest properties “a natural extension of activities in luxury hospitality with Cheval Blanc”.

The business will be made up of a six-person management team headed by Olivier Lefebvre.

No financial information was released by the French luxury goods company, but it is understood LVMH will seek to keep capital investment to a minimum.