InterContinental Hotels Group has followed through on its
plan to buy a luxury brand, agreeing to acquire a 51% stake in Regent Hotels
and Resorts for $39 million in cash.
When the transaction is complete, IHG will form a joint
venture with Formosa International Hotels, a Taiwanese company that has owned
Regent for almost eight years. IHG will have the right to acquire the remaining 49%
interest in a phased manner from 2026.
The Regent brand, founded in 1970, has just six hotels, none
in the U.S. The brand operates hotels in Beijing, Chongqing, Taipei, Singapore,
Montenegro and Berlin. Hotels are in development in Jakarta, Indonesia; Harbin,
China; and Phu Quoc, Vietnam, according to Regent's website. The Jakarta hotel
is expected to open late this year.
IHG said it intends to reach 40 Regent hotels and resorts "over
the long term."
Following an extensive refurbishment due to begin in
early 2020, the InterContinental Hong Kong will become a Regent hotel in early
2021. That property originally opened its doors in 1980 as a Regent hotel.
"As one of the pioneers in defining luxury hotels both
in Asia and around the world, Regent is an excellent addition to IHG's
portfolio of brands," stated IHG CEO Keith Barr. "We see a real
opportunity to unlock Regent's enormous potential and accelerate its growth
Regent was once owned by Carlson Hotels, which sold the
brand to Formosa in 2010. Carlson had difficulty growing the brand, and so has
Formosa executive chairman Steve Pan said that with IHG
buying a stake in Regent, the brand will "return to its former glory."
He predicted "one of the greatest comebacks in the hotel industry."