Province
TORONTO — Another Canadian corporate monument is toppling into foreign ownership with a deal for a Saudi prince and an American property magnate to take over Fairmont Hotels & Resorts Inc.
Fairmont, which originated in the historic Canadian Pacific Railway luxury hotel chain and counts the Chateau Laurier, Royal York and Banff Springs among its properties, said yesterday its board is supporting an offer of $3.8 billion, from Kingdom Hotels International and Colony Capital.
Including assumed debt, the deal is valued at $4.5 billion.
Kingdom Hotels is owned by Saudi Prince Alwaleed bin Talal bin Abdulaziz Alsaud, a global investor listed by Forbes magazine as the world’s fifth-richest person with a net worth of $27.1 billion. He also owns 23 per cent of Toronto-based Four Seasons Hotels Inc.
Colony Capital is a Los Angeles private equity firm run by Tom Barrack, recently described by Fortune magazine as the world’s best real-estate investor.
Fairmont‘s announcement came five days after Hudson’s Bay Co., Canada’s oldest corporation, agreed to be taken over by American businessman Jerry Zucker.
“From many perspectives, you’re not going to see much difference,” Fairmont CEO William Fatt said. “It’ll still be Canadian-managed and our head office here.”
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HOTEL CHAIN AT A GLANCE
History: Began as the Canadian Pacific Railway’s chain of grand hotels, then acquired CN’s hotel chain in 1988, Princess Hotels in 1998 and U.S.-based Fairmont in 1999. Spun off in the breakup of Canadian Pacific Ltd. in 2001.
Fairmont today: Operates 87 high-end properties with 34,000 guest rooms in Canada, the U.S., Mexico, Bermuda, Barbados, Britain, Monaco, Kenya and the United Arab Emirates.
Deal: Including debt, $4.5 billion Cdn.
© The Vancouver Province 2006
