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Singapore's CDL Offers to Buy Out Millennium & Copthorne Hotels in $822M Deal

Singapore's CDL Offers to Buy Out Millennium & Copthorne Hotels in $822M Deal

On Monday, the developer announced it is offering 552.5 pence each for the remaining shares in M&C it does not own, in a deal which values the hotel group at £1.8 billion ($3.2 billion).

The company, which runs brands including Millennium, Grand Millennium and Copthorne, has struggled recently with its revenue per available room - a key industry metric known as RevPAR - dropping 2.3pc on a constant currency basis in 2016.

Under the terms of the proposed buyout, shareholders in the hotel chain would receive 545 pence ($0.719) per share, plus a special dividend of 7.5 pence per share. The price is a 21% premium to Millennium's closing share price of 455 pence on Friday.

Brokers are unanimously positive on City Developments' potential offer for Millennium & Copthorne Hotels, given that the acquisition will be value accretive to the group. According to the directors of M&C, the terms of the bid are fair and reasonable.




City Developments indirectly held shares representing a 65.2 per cent stake in M&C as of Oct 9.

M&C, which operates the Millennium, Grand Millennium, Copthorne and Kingsgate brands, has a portfolio of over 130 hotels in 17 countries around the world, from the Millennium Biltmore Los Angeles to the Grand Millennium Beijing.

CDL has planned to maintain M&C's business model and become the owner and operator of its properties. It added that the company has no intention in selling or repurposing any of Millennium's hotels in London or in NY.


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