DLF's sale of Aman Resorts nearly complete, to retain Delhi property

Apart from Aman Hotel (Delhi), earlier Lodhi Hotel, the chain has two other hospitality properties in India, the Aman-i-Khas and Amanbagh, both in Rajasthan

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Travel News

DLF, the country’s largest property developer, is likely to conclude the Aman Resorts deal by early 2012. The aim is to do so before the financial year is over.

It has been in negotiation with many bidders for several months to offload its stake in Aman Resorts, the hotel chain. The company has got final bids from four to five companies and bankers are close to finalising the deal. DLF would offload its stake in the chain, while retaining the Delhi Aman property.

Khazanah, the Malaysian government’s wealth fund, is being seen as the most likely buyer. Other prominent bidders include Kingdom Holdings, the company which owns the Four Seasons Hotel, and a Chinese hospitality group, it is learnt.

A DLF official said that the bankers were yet to give a report on the deal to the company. The DLF spokesperson refused to comment. Goldman Sachs and the Citi group are advisors for the deal. The founder of Aman Resorts, Adrian Zecha, is expected to be involved in the final decision. Zecha owns and operates a number of hotels across the world. DLF had bought Aman Resorts in 2007 for $400 million.

Apart from Aman Hotel (Delhi), earlier Lodhi Hotel, the chain has two other hospitality properties in India, the Aman-i-Khas and Amanbagh, both in Rajasthan.

According to sector experts, DLF has not been able to do much in integrating the hotel business with its overall strategy. At the time it invested in Aman, DLF looked at this as an annuity business, a long-drawn process.

“The company, which has a strong presence in other sectors like retail, has seen a quicker cash flow in those businesses. They also got it right in the retail business with good locations, etc. In hotels, things work differently. There is a lean period before the launch and the money flows over a period of time,” said a senior analyst who did not wish to be quoted.

DLF aims to cut debt through the divestment of non-core assets, including hotels and plots of land that cannot be developed in the next five years. The company’s debt was pegged at Rs 22,500 crore as of end-September. It expects to cut this to around Rs 10,000 crore by 2013.

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