Inspiration Hlt Regulatory News (IHC)

1 Aug 2006 07:02

India Hospitality Corp.01 August 2006 NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION IN OR INTO THE UNITED STATES OFAMERICA For Immediate Release 1 August 2006 INDIA HOSPITALITY CORP $100M Fundraising Makes New AIM Entrant Largest SPAC Focused On India •Targeting multiple acquisitions in hospitality, leisure, tourism, travel and related industries •Management team headed by Jason Ader - proven track record in hospitality sector investment and research - previously Senior Managing Director with Bear Stearns & Co before founding New York based investment manager Hayground Cove •Experienced management team with "on the ground" presence and sourcing network - key to successful diligence and investment selection •Focus on fast-growing Indian cities and top tourist destinations in India -non-luxury markets overlooked by major players •India's GDP has recently grown at 7-8%, expected to continue •India's middle class estimated at 300m in 2005, expected to grow to 500m by 2010 - greater purchasing power allied to more budget airline entrants underpins significant domestic air travel growth expectations - further fuelling hospitality growth •Attractive growth potential due to significant sector demand/supply imbalance - recent Government initiatives to address shortage of hotel rooms, especially ahead of the 2010 Commonwealth Games •Dealings due to start on AIM today •Deutsche Bank AG London acting as NOMAD Commenting on the fundraising and admission to AIM, CEO Jason Ader said "the$100m raised shows confidence in the opportunity to generate superiorshareholder returns from our targeted area of the Indian hospitality market." Contact: Mark Edwards/ Richard Oldworth Buchanan Communications +(44) 207 466 5000 INDIA HOSPITATLITY CORP $100 MILLION FUND RAISING AND ADMISSION TO AIM India Hospitality Corp ("IHC" or "the Company") is pleased to announce that ithas raised $100 million and dealings are due to commence on AIM today. NominatedAdviser and Broker to the Company is Deutsche Bank AG London PROPOSED BUSINESS IHC intends to use the funds raised to acquire an Indian business, businesses orassets focused on the hospitality, leisure, tourism, travel and relatedindustries, including but not limited to hotels, resorts, timeshares, servicedapartments and restaurants. While potential acquisitions could come from any ofthese sectors, IHC intends to focus primarily on the hospitality industry. Thesemarkets in India, and particularly the hospitality industry, are high-growth,underserved and fragmented, and they offer profit margins, returns on capitaland cash flows that are among the most attractive in the world. IHC intends toplace emphasis on acquiring businesses in fast-growing Indian cities and toptourist destinations in India. IHC believes that the predominantly localhospitality businesses serving these segments have generally not pursuedaggressive growth strategies, but instead have followed an own-and-manage modelas opposed to the lease or franchise model employed by hospitality industryleaders. The Company believes opportunities exist to negotiate purchasesdirectly with these companies and their individual owners. In addition, IHCbelieves that it will be able to use its management's expertise in operationsand financing to manage the businesses or assets which IHC may acquire, and todeliver superior risk-adjusted returns for shareholders. Strategy IHC's strategy to focus on the non-luxury segment of the Indian hospitalitymarket is driven by the following key points: • At 7-8% GDP growth, India has one of the fastest growing economies in the world • Foreign direct investment in India's trade, hotels and restaurants industries is at a lowly 1% of total inflows to India despite being one of the fastest growing sectors • Government initiatives to promote sector investment • Indian hospitality industry is largely driven by domestic market, particularly domestic tourism which grew 13.7% CAGR between 2000 and 2004 • Rapid expansion of Indian middle class - from 300m 2005 to 500m in 2010 • Increasing disposable per capita income and growth in lost cost travel fuelling further growth in domestic tourism. • Current demand / supply imbalance with significant shortage of hotel rooms, particularly ahead of 2010 commonwealth Games. • Non-luxury segment of market is overlooked by sector major players - offering potentially superior shareholder returns. MANAGEMENT Directors and Executive Officers (for biographical details see Appendix) The Company's current Directors and executive officers are as follows: Name Age Position------ ----- ----------Jason N. Ader 38 Chief Executive Officer and Chairman of the Board of DirectorsAndrew Sasson 36 Chief Operating Officer and DirectorRaj Nandiwada 41 Vice President, New Business DevelopmentChrista Short 33 DirectorPawan Munjal 51 DirectorAnthony Juliano 39 DirectorManvinder Puri 51 DirectorRajeev Talwar(1) 51 Prospective Director (1) Mr. Talwar is not currently a member of the Board of Directors of theCompany. His appointment will only occur if and when he receives final approvalby the requisite Indian governmental agencies of his resignation from hispositions as Additional Director General, Ministry of Tourism and the Chairmanand Managing Director of India Tourism Development Corporation. There can be noassurance that he will receive such approvals. Investment Committee IHC will form an investment committee to advise and consult with the Company'smanagement team with respect to its investment policies, financing andleveraging strategies and investment guidelines. The investment committee willprovide the Company with a competitive advantage in analyzing and valuingacquisition candidates through their experience, financial industry contacts andinvestment ideas. Experienced Management Team and Strong Local Network The Company's executive officers and Directors, and Hayground Cove's ''on theground'' network in India, have extensive experience in the hospitality,leisure, tourism, travel and related industries as executive officers,principals or Directors in various enterprises throughout the world. Jason N.Ader, the Company's Chief Executive Officer and the Chairman of the Board ofDirectors, is the Chief Executive Officer of Hayground Cove Asset ManagementLLC, a New York-based investment management firm with approximately $1.46billion of assets across funds and managed accounts under management as of May31, 2006. The funds of Hayground Cove in operation since January 1, 2004 hadreturns of approximately 2.54x the returns on the S&P Hedge Fund Index fromJanuary 1, 2004 through May 31, 2006. Mr. Ader has a strong asset managementrecord and, prior to founding Hayground Cove, was a Senior Managing Director atBear Stearns & Co.,Inc. where he performed equity and high yield research formore than 50 companies in the gaming, lodging and leisure industries. Mr. Aderwas rated as one of the top ranked analysts by Institutional Investor Magazinefor nine consecutive years from 1994 to 2002. Members of the Company'smanagement team have, on average, approximately 13 years of experience in thehospitality, leisure, tourism, travel and related industries. The Company'smanagement team has a successful track record of completing large-scaleacquisitions and minority investments in businesses competing in thehospitality, leisure, tourism, travel and related industries. The Company'smanagement team's experience and familiarity with the hospitality, leisure,tourism, travel and related industries is an important asset that will assist usin implementing the Company's business strategies and pursuing its growthopportunities. The Company will serve as Hayground Cove's only vehicle fordirect, private investments in the Indian hospitality sector. The Company's management team possesses broad industry knowledge and corecompetencies that the Company believes will enable it to identify attractivepotential targets. In addition, Banyan Tree Capital and Hayground Cove's networkof professionals in India has a wide range of contacts that the Company expectswill help it to identify prospective acquisition candidates. ADMISSION TO AIM Dealings on AIM are due to start today (1 August 2006) APPENDIX Jason N. Ader is the Company's Chief Executive Officer and Chairman of the Boardof Directors. Mr. Ader founded and serves as the President and Chief ExecutiveOfficer of Hayground Cove Asset Management LLC, a New York-based investmentmanagement firm with approximately $1.46 billion of assets across funds andaccounts under management as of May 31, 2006. Mr. Ader has a strong assetmanagement record and, prior to founding Hayground Cove, served as a SeniorManaging Director at Bear Stearns & Co., Inc. from 1995 to 2003, where heperformed equity and high yield research for more than 50 companies in thegaming, lodging and leisure industries. From 1993 to 1995, Mr. Ader served as aSenior Analyst at Smith Barney covering the gaming industry. From 1990 to 1993,Mr. Ader served as a buyside analyst at Baron Capital, where he covered thecasino industry. Mr. Ader has a B.S. degree in Economics from New YorkUniversity and a M.B.A. in Finance from New York University, Stern School ofBusiness. Andrew Sasson is the Company's Chief Operating Officer and a member of theCompany's Board of Directors. In February 2006, Mr. Sasson acquired the land todevelop Spa Lofts, a modern loft condominium project in Las Vegas. Mr. Sassonwas a partner in Panorama Towers, a high-rise condominium in Las Vegas, fromJanuary 2004 to November 2005, pioneering the Las Vegas high-rise market. Mr.Sasson is currently developing a $500 million non-gaming boutique hotel as partof MGM Mirage's $7 billion ''Project City Center.'' The hotel will serve as thegateway into the 66 acre development and is being planned by a world renowned design team. Mr.Sasson also owns and operates the Light Group, a $100 million Las Vegashospitality company known for its innovative and profitable venues including FIXRestaurant and Bar at the Bellagio Hotel and Resort and Stack Restaurant at theMirage Resort and Casino, among others. Mr. Sasson has been a prominentparticipant in the hospitality industry for the past 16 years. Raj Nandiwada is the Company's Vice President, New Business Development. Mr.Nandiwada has served as an analyst at Hayground Cove since March 2006. Mr.Nandiwada founded and served as the Chief Executive Officer of Global InfozoneInc. from June 2004 to March 2006. From March 1998 to June 2004, Mr. Nandiwadaserved as Quantitative Analyst/Portfolio Engineer at Jacobs Levy EquityManagement, where he developed quantitative models, performed equity researchand traded equities. Mr. Nandiwada has a B.S. degree in Engineering from theRegional Engineering College in Nagpur, India, a Master's Degree in SystemsScience from Louisiana State University and a M.B.A. in Finance from New YorkUniversity, Stern School of Business. Christa Short is a member of the Company's Board of Directors. Ms. Short hasserved as a Managing Director-Research Analyst at Hayground Cove since September2003. From August 2001 to August 2003, Ms. Short was an equity research analystcovering gaming, lodging and leisure industries at Bear Stearns & Co., Inc., andshe served as Vice President-Equity Research from January 2003 to August 2003.Ms. Short has a B.B.A. degree in Finance from the University of Michigan and aM.B.A. in Finance and Strategy from Kellogg Graduate School of Management atNorthwestern University. Pawan Munjal is a member of the Company's Board of Directors. Mr. Munjal is theManaging Director and Chief Executive Officer of Hero Honda Motors Limited,positions which he has held since 2002. Mr. Munjal has also served as a directorof Hero Honda Motors Ltd., a joint venture between Hero Cycles Ltd. and HondaMotor Co. of Japan. Over the years, he has played a significant role in itsdevelopment and growth. Under his leadership, Hero Honda Motors Ltd. Has emergedas the world's No. 1 two-wheeler company from 2000 to 2005. As the chiefexecutive of one of the principal Hero Group Companies, Mr. Munjal is aconstituent of the ''Core Team'', which looks at growth and strategic planningfor the entire group of associated companies. He is currently a member of theSociety for Indian Automobile Manufacturers Committee on Two and Three-wheelers,and a member of the World Economic Forum. A known figure in industry forums, Mr.Munjal has been the chairman of several committees of the Confederation ofIndian Industry, or CII, including Technology and Innovation from 2004 to 2005,Environment from 2003 to 2004, and Sports from 2000 to 2002. He was alsochairman of the Northern Region of the CII from 1996 to 1997. Mr. Munjal has aB.E. degree in Mechanical Engineering from the University of Kurukshetra. Anthony Juliano is a member of the Company's Board of Directors. Mr. Juliano hasserved as the Executive Director, Dubai Investment Group, Global Real Estate andHospitality since March 2006. At Dubai Investment Group, he oversees a $2billion U.S. real estate portfolio, including a $700 million hospitalityportfolio. From July 1999 to March 2006, Mr. Juliano held various seniorpositions with GE Real Estate, including positions with the private equityinvestment platform and large loan/mezzanine financing groups. Mr. Juliano was areal estate attorney with Thacher Proffitt & Wood from 1993 to 1999 where hispractice concentrated on real estate finance and capital markets. He has a B.A.degree in English from the State University of New York at Albany and a J.D.degree from New York Law School. Manvinder Puri is a member of the Company's Board of Directors. Mr. Puri hasserved as Vice President of the Americas division of GHM Hotels since January2004. He also served as General Manager of The Setai, South Beach, a GHM Hotel,in Miami, Florida from January 2004 to January 2006. From January 2003 toDecember 2003, Mr. Puri was the Group General Manager of the Hong Kong andShanghai Hotels, Limited, and he was the Senior Vice President of Operations atRaffles International, a Singapore-based hotel chain, from March 2001 toDecember 2002. For over 30 years, Mr. Puri has been associated with the finesthotels around the world, including the Peninsula Hotels in Hong Kong, RafflesHotel in Singapore, The Fullerton Hotel in Singapore, Rosewood Hotels andResorts, British Airways Hotels, The Ritz Carlton in Hawaii, Halekulani inHonolulu, the Fairmont Hotel in Chicago, and La Mansion in San Antonio. Mr. Puristudied Food & Beverage Management and Financial Management at CornellUniversity, as well as Business Management at Punjab University in his nativeIndia. Rajeev Talwar has been offered a position on the Company's Board of Directors.He has resigned from his position in government on June 6, 2006; however hisresignation is pending approval. Mr. Talwar's appointment will only occur if andwhen he receives final approval by the requisite Indian governmental agencies ofhis resignation. There can be no assurance that he will receive such approvals.Mr. Talwar is currently Additional Director General (Ministry of Tourism)Government of India (since February 2005), CEO National Council for HotelManagement and Catering Technology (since February 2005), and Chairman andManaging Director India Tourism Development Corporation (since March 2005),which manages government owned hotels, travel agencies and all duty free shops.Prior to joining the Ministry of Tourism, Mr. Talwar was assigned to the DelhiGovernment where he managed many portfolios and was Managing Director and ChiefExecutive Officer of Delhi Tourism from August 2001 to December 2003 where hewas responsible for the implementation of the entire tourism policy of Delhi,Secretary, Information and Public Relations from June 1999 to January 2005, andChairman and Managing Director Delhi Transportation Corporation from July toDecember 2004. Mr. Talwar has been in the Indian Administrative Service (IAS)since his induction in 1978. During his 28 year career he has had a crosssectoral experience at a senior management level, and policy making level, aswell as widespread field experience. He has been involved on an all-India basisin a variety of sectors of the economy, including: civil aviation, tourism,labour, shipping, roads, inland waterways, coal and food processing. As a resultof his position, Mr. Talwar has had exposure to managements of a large number ofpublic and private sector enterprises along with statutory bodies in thetransport, tourism and infrastructure sectors. Mr. Talwar holds a B.A. (Honorsin History) and a M.A. (History) from St. Stephen's College, Delhi. This information is provided by RNS The company news service from the London Stock Exchange