HONG KONG 1 September 2020: The Hongkong and Shanghai Hotels, Limited announced Monday that via a wholly-owned subsidiary, it has entered into heads of terms to restructure the current arrangement with its Thai partners, the Phataraprasit Shareholders.
Subject to the signing of definitive and legally binding agreements and following the completion of the restructuring, the joint venture relationship between the parties will cease.
HSH plans to acquire the Phataraprasit Shareholders’ 50% economic interest in The Peninsula Bangkok and its surrounding land, through a wholly-owned subsidiary for a cash consideration of USD70 million (approximately HKD546 million) excluding taxes plus 50% economic interest in the Thai Country Club and various land parcels close to the Club. The cash amount will be funded from the company’s own resources.
Upon completion of the transaction, the company will assume full ownership and control over the development, management and future operations of The Peninsula Bangkok and its surrounding land.
However, HSH will cease to have any responsibility for the development, management and future operations of the Thai Country Club and various land parcels close to the Thai Country Club. The restructuring is in line with the company’s principal business of hotel ownership and management and reflects the desire of the company and the Phataraprasit Shareholders to resolve all current and contingent disputes, including the dispute on the hotel management agreement relating to The Peninsula Bangkok.
“This was a difficult decision for the group and one that was taken in the light of the very challenging global and domestic market circumstances and the legal dispute between the partners,” said HSH CEO and managing director Clement Kwok. “We are sad to no longer own and operate Thai Country Club… We remain committed to Thailand as a long-term investment, and we plan to reopen The Peninsula Bangkok when the coronavirus situation improves, hopefully in autumn 2020.”
*Heads of Terms: A document which sets out the terms of a commercial transaction agreed in principle between parties in the course of negotiations. Heads of terms evidence serious intent and have moral force, but do not legally compel the parties to conclude the deal on those terms or even at all.
About Hongkong and Shanghai Hotels,
Incorporated in 1866 it is listed on The Stock Exchange of Hong Kong (00045). HSH is the holding company of a group which is engaged in the ownership, development and management of hotel, commercial and residential properties in key locations in Asia, the United States and Europe, as well as the provision of tourism and leisure, club management and other services.
Hotels
Peninsula Hong Kong, Peninsula Shanghai, Peninsula Beijing, Peninsula Tokyo, Peninsula New York, Peninsula Chicago, Peninsula Beverly Hills, Peninsula Paris, Peninsula Bangkok, and Peninsula Manila. Projects under development include Peninsula London, Peninsula Istanbul and Peninsula Yangon.
Property and services
The Repulse Bay Complex, The Peak Tower and St. John’s Building in Hong Kong; The Landmark in Ho Chi Minh City, Vietnam; and 21 avenue Kléber in Paris, France. The clubs and services portfolio of the Group includes The Peak Tram in Hong Kong; Quail Lodge & Golf Club in Carmel, California; Peninsula Clubs and Consultancy Services, Peninsula Merchandising, and Tai Pan Laundry in Hong Kong.
