French hotel group Accor has confirmed it is to establish an investment fund with InterGlobe Enterprises to accelerate expansion In India.
The new venture will focus on upper mid-range and upscale hotels on the sub continent and continues to illustrate Accor’s plan to be the world’s third-largest hotel group by 2015.
At present it ranks fourth behind the InterContinental, Marriott and Starwood.
Under the terms of the new deal Accor and InterGlobe will each hold 32 per cent of the equity in the fund, while the asset manager for the joint venture, Pacifica Partners, will take a significant stake of up to 36 per cent.
Accor chairman Gilles Pelisson said: “The establishment of this fund demonstrates Accor’s ability to enter new markets through effective partnerships, creating a portfolio of high quality assets and then realising the potential of these assets.
“The investment of Pacifica into this fund provides a platform for further growth in the strategic market of India where Accor and InterGlobe have already created an extensive development pipeline.”
The fund will initially hold the assets for seven hotels in India which are currently jointly owned by Accor and InterGlobe, representing 1,750 rooms with a value of approximately $US325 million on the completion of the hotels.
Rahul Bhatia, group managing director at InterGlobe Enterprises added: “We are committed to growth in the hotel sector in India.
“The establishment of this new investment fund represents our intention to expand our footprint of upper mid-scale and upscale hotels in India.”
Accor presently operates eight properties in India in conjunction with InterGlobe, with a further seven presently in the development pipeline.
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