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Bakers, Henry Davis York act on hotel deal
Baker & McKenzie and Henry Davis York have advised on the year’s largest hotel transaction — the InterContinental Hotels Group’s (IHG) structured sale
Lawyers Weekly
Baker & McKenzie and Henry Davis York have advised on the year’s largest hotel transaction — the InterContinental Hotels Group’s (IHG) structured sale of nine hotels to Eureka Funds Management Limited. Baker & McKenzie acted for IHG and Henry Davis York acted for Eureka.
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The sale was made to Eureka as trustee for a hotel sector specific wholesale fund, with equity sourced from superannuation funds and the sale for $15 million of the Holiday Inn, Suva, to an entity associated with the Fiji National Provident Fund. The parties also entered into a 20-year management agreement for IHG to manage and operate the hotels under the InterContinental, Crowne Plaza and Holiday Inn brands.
Corporate partner Graeme Dickson led Baker & McKenzie’s contract negotiation team, assisted by Hanna Lee, while Roy Melick headed the due diligence team, assisted by Sebastian Busa.
Banking and finance partner Roger Dobson led the Henry Davis York team, with extensive input from Richard Snowden, James Lonie, Kathy Civardi, Andy Steele and Susan Ritchie.
Dickson said it was a unique process to be working on a sale agreement with a management agreement mindset.
“We were trying to maximise the price of the sale, but in an environment where after the close we could sit down with the owner and manage the properties for the next 20 years,” he said.
Henry Davis York’s Dobson said the competitive nature of the process changed the dynamics from the buyer’s point of view. “We were very conscious of the competitive process we were in, which the vendors used very cleverly to create tension.” Dobson said there was also a number of complex tax and corporate issues to be dealt with.
