Corinthia signs major hotel partnership deal

The Corinthia Group has announced a strategic partnership with Wyndham Hotels Group (WHG), the world's largest hotel company.

Under the terms of a series of agreements signed this week, WHG is acquiring 30 per cent of CHI Ltd, which is Corinthia's hotel management arm, simultaneously licensing CHI to be the exclusive operator for their five-star Wyndham and upper four-star Ramada Plaza brands in Europe, Africa and the Middle East.

Financial terms were not disclosed.

WHG has ambitious plans to grow these brands across these regions and are buying into CHI to support this expansion with the services of a hotel management company.

CHI will continue to operate hotels under the brand name Corinthia in the five-star deluxe category.

In line with these licensing arrangements, the current portfolio of 20 Corinthia hotels will be reorganised so that hotels in the four-star category will be rebranded to Ramada Plaza Hotels, those in the five-star category will be rebranded to Wyndham Hotels and those in the upper five-star category will remain as Corinthia Hotels, affiliated to the Wyndham Grand Collection. No decision has yet been taken on the four local hotels.

"It is a real coup that the Corinthia brand will be kept for the top range of the properties," a company spokesman said.

Simultaneously, International Hotel Investments plc, Corinthia's public company, is acquiring Corinthia's remaining shares in CHI Ltd, thus increasing its shareholding to 70 per cent from its present 20 per cent.

"Holders of IHI shares will eventually get full details in accordance with the listing rules but clearly they are going to hold shares in something that is going to grow substantially," the spokesman said.

The agreements covering these arrangements were signed in Malta on Thursday by senior executives from Corinthia, IHI and CHI, and also from WHG represented by CEO Steven Rudnitsky.

"This partnership will take CHI onto a new level, operating across three continents, and running hotels on behalf of owners under any of three brands: Corinthia, Wyndham and Ramada Plaza," Corinthia chairman and CEO Alfred Pisani said.

"This relationship will expand our portfolio in the region and establish our management business, which will become an integral component of our expansion strategy," Mr Rudnitsky said.

"Our goal is also to deliver more bookings to existing Corinthia properties by integrating them into our sales, marketing and distribution systems."

The agreements are subject to certain regulatory merger control approvals from the EU, which are expected to be forthcoming within two months, after which more details will be given.

Wyndham Hotel Group, one of three principal components of Wyndham Worldwide, encompasses more than 6,400 franchised and managed hotels and 535,000 hotel rooms worldwide.

Through Wyndham Hotel Group, RCI Global Vacation Network and Wyndham Vacation Ownership, Wyndham Worldwide offers a broad suite of hospitality products and services across various accommodation alternatives and price ranges.

RCI Global Vacation Network offers its more than three million members access to approximately 55,000 vacation properties located in more than 100 countries. Wyndham Vacation Ownership develops, markets and sells vacation ownership interests and provides consumer financing to owners through its network of more than 140 vacation ownership resorts serving more than 750,000 owners throughout North America, the Caribbean and the South Pacific.

Wyndham Worldwide, headquartered in New Jersey, employs about 28,800 employees globally.

The Corinthia Group participates in the world travel industry through its four business units including International Hotel Investments, which focuses on hotel real estate acquisition and investment; Corinthia Hotels International, which manages four- and five-star hotels totalling 5,300 rooms in 11 countries in Europe, Africa and the Mediterranean as well as a network of sales offices worldwide; Quality Project Management, which provides construction and project management services; and Corinthia In-Flight Services, which provides industrial catering. The company employs about 5,000.