Acquisition

15 Dec 2006 07:58

Trinity Capital PLC15 December 2006 Trinity Capital PLC ("Trinity") Invests in a new company to own and develop luxury Indian Hotels Trinity is pleased to announce that it will invest £11.34 million, in a specialpurpose vehicle which currently owns one 5 star Indian hotel and has acquiredland to develop a further three luxury hotels over the next three years.Dynamix-Balwas Group owns the operating hotel, Le Royal Meridian in Mumbai.Trinity and IL&FS Investment Managers ('IL&FS') have jointly invested in equalproportions. IL&FS is one of India's leading financial institutions. On the 4 August 2006,Trikona Capital ("Trikona"), the asset manager for Trinity, announced a 50:50$100 million partnership with IL&FS to invest in the development of real-estateassets in India. Today's announcement represents the first allocation under thisplatform and accounts for 45% of the partnership's commitment. Dynamix-Balwas Group is a premium Mumbai based developer and has developed inexcess of 10 million sq ft of real estate in the form of township projects,residential complexes and shopping malls in and around Mumbai. Le Royal Meridian in Mumbai was established in 2000 and is managed by LeMeridian Group, for the twelve months to 31 March 2006 the hotel had an averageoccupancy rate of 93%. The new company will develop a further three hotels, inMumbai, Pune and Goa all targeting the luxury end of the market adding in excessof 1000 rooms. The management teams are in discussions with the Hyatt Group tooperate and manage the three development properties which should be completedwithin the next 36 months. India's current lack of hotel space has been widely publicised. In 2003, therewere as many five star hotel rooms (5,000) in a single hotel, the MGM Grand inLas Vegas, USA, as there were in Mumbai. With only 26,000 rooms in the brandedsector, there is an acute shortage of high end hotel rooms. It is also estimatedthat demand for branded rooms will reach 100,000 to 125,000 rooms over the nextdecade. Demand for luxury hotels in South Mumbai outstrips supply and there havebeen no significant hotel development in South Mumbai in last two decades. Aashish Kalra, Managing Director of Trikona Capital, said: 'The Indian hotelsector is undergoing a rapid transformation, as operators seek to exploit theobvious gap between demand and supply. It is the stated objective of TrikonaCapital to build one of the largest hospitality platforms in the country,covering the mid and high end hotel markets. As with this transaction ourstrategy will continue to be to form partnerships with the leading playerswithin the hospitality sector.' ENDS Enquiries: Trikona Capital Aashish Kalra +91 11 2620 7257 Cardew Group Tim Robertson +44 20 7930 0777 Sofia Rehman Catherine Maitland (London) Gutenberg Communications Harjiv Singh (New York) +1 917 623 7793 Pranav Kumar (Delhi) +91 98100 77898 Numis Iain McDonald +44 20 7776 1567 Notes: • For further information and regular updates regarding the Fund's activities, please log on and sign up for news alerts at www.trinityplc.com This information is provided by RNS The company news service from the London Stock Exchange