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GlobeSt.com UPDATE: Colony Capital Closes $1B Acquisition of Raffles Hotel Business

SINGAPORE- The private international investment firm now holds 100% direct equity interest in Raffles International Limited, which owns a network of 41 hotels and resorts in 35 international destinations.

By Brian K. Miller | Updated on September 30, 2005

SINGAPORE-Locally based Raffles Holdings Ltd. has closed on the $1.01-billion sale of its hotel business to an international investment fund of Los Angeles-based Colony Capital. Colony Capital now holds 100% direct equity interest in Raffles International Limited, which owns some 12,000 rooms in 41 hotels and resorts located in 35 cities in Asia, Australia, Europe, Mediterranean, Middle East, North and South America.

The news of the acquisition agreement broke in July. For Raffles, the sale will return a large amount of capital to its shareholders by way of a special dividend and allow it to retain substantial capital for reinvestment into “higher yielding assets,” said company president-chief executive Jennie Chua at that time. Raffles deputy chairman Liew Mun Leong added that while its hotel business is performing well, it is at strategic crossroads.

“To grow the hotel business to gain global scale will entail significant capital investments,” she said. “The strong performance of the hotel business combined with the current active M&A market presented a timely opportunity for RHL to realize value in the business it has built over the years… .”

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