Istithmar Hotels of Dubai has taken a €178 million ($230 million) stake in five-star hotel company International Hotel Investments (IHI).
The newly launched hospitality wing of private equity firm Istithmar will provide added firepower to Malta-based IHI and its plans to expand.
It will also give Istithmar, which is ultimately owned by Sheikh Mohammed bin Rashid Al Maktoum, the Crown Prince of Dubai, a significant stake in a number of luxury hotels in new markets including the Corinthia San Gorg Hotel in Malta, the Corinthia Nevskij Palace Hotel in St. Petersburg, the Grand Hotel Royal in Budapest and the Lisboa Hotel in Lisbon.
Istithmar has made the investment by subscribing to 178 million new shares issued by IHI. Simultaneously, IHI is acquiring the Corinthia Bab Africa Hotel & Commercial Centre in Tripoli and the Corinthia Towers Hotel in Prague from the Corinthia Group. As part of the transaction, IHI will give Corinthia shares in the company.
Istithmar Hotels of Dubai was created in April to manage the hospitality assets within Istithmar’s investment portfolio. It manages luxury, budget and boutique hotels in London, Paris and New York, as well as emerging markets such as China and India.
In October Istithmar splashed out $285 million to buy the W Hotel Union Square in New York, adding to previous purchases including the Knickerbocker Hotel at Times Square. The private equity firm has also recently acquired two New York office properties, 280 Park Avenue and 450 Lexington Avenue.