MUMBAI, Nov 8 (Reuters) - Indian Hotels Company(IHC), owner of the Taj Mahal chain of hotels andresorts, will not pursue its $1.2 billion bid to acquire U.S.luxury hotels group Orient-Express Hotels, it said onFriday, ending a year-long chase.
The company said the board had decided not to pursue theoffer after taking into account all factors, including thecurrent economic environment and other opportunities andpriorities.
In October last year Indian Hotels, controlled by the $100billion salt-to-steel Tata Group, made an unsolicited bid toacquire Orient-Express, in which it has a 7 percent holding.
Orient-Express, which owns the Hotel Cipriani in Venice andthe '21' Club in New York, rejected the bid a month later,saying it undervalued the business.
Indian Hotels' quarterly net loss widened to 3 billionrupees ($48 million) for the three months to Sept. 30, comparedwith a net loss of 63.6 million rupees in the same period lastyear, after writing down the value of its investments inoverseas assets including Orient-Express.
Net sales rose 3 percent to 3.9 billion rupees.
After foregoing the Orient-Express bid, Indian Hotels saidit has reduced the value of its holding in Taj InternationalHotels (HK), the holding company for its international entitiesincluding Orient-Express, by 2.87 billion rupees.
Indian Hotels' investors had greeted its unexpected andunsolicited bid for Orient-Express with wariness because ofconcerns that it would add to the company's debt load.
The Indian company has bought several overseas properties,including the Pierre in New York, but they have not tended toperform as well as its domestic operations, which include itsflagship Taj Mahal Palace in Mumbai.
- Investment & Company Information