InterContinental Hotels Group (IHG) has acquired a 51% stake in luxury brand Regent Hotels and Resorts for $39m (£28m) from Formosa International Hotels Corporation.
It will have the right to acquire the remaining 49% interested in a phased manner from 2026.
Regent will now be propelled to the top of IHG's 13 existing brands as a luxury group of hotels, higher than the well-established InterContinental Hotels & Resorts brand. IHG intends to grow Regent from the six managed hotels it has today in Berlin, Porto Montenegro (pictured), Beijing, Taipei, Singapore and Chongqing to more than 40 cities and resort locations around the world.
Rumours have been swirling around the industry that IHG was on the verge of buying a luxury brand ever since IHG's chief executive Keith Barr announced at the publication of the company's annual results on 20 February that the group intended to acquire a small luxury brand or brands, as well as launch a "new upscale conversion brand". Many commentators had predicted that Belmond was the brand that IHG was chasing.
IHG will now launch a new luxury division, suggesting that further acquisitions in the sector will be on the cards.
Founded in 1970 by hotelier Robert Burns as a leading luxury brand that would combine "Asian hospitality with Western elegance", Regent has passed through the hands of various of owners in the intervening years including Four Seasons and Carlson until it was sold in 2010 to Taiwan-based Formosa International Hotels.
The InterContinental Hong Kong, which originally opened in 1980 as one of Regent's most iconic hotels, will now be refurbished and reopen as a Regent hotel in 2021.
Keith Barr, chief executive of IHG, said: "As one of the pioneers in defining luxury hotels both in Asia and around the world, Regent is an excellent addition to IHG's portfolio of brands. We see a real opportunity to unlock Regent's enormous potential and accelerate its growth globally.
"In addition, by creating a dedicated luxury division, we will be bringing together some of the most experienced and respected people in the industry who will help drive our luxury offer, ensuring that our existing luxury brands continue to evolve and allowing us to bring in new brands such as Regent to enhance our brand portfolio."
Steven Pan, executive chairman of Formosa International Hotels Corporation commented: "The brand has an unrivalled heritage at the very top end of the luxury segment and the flagship Regent Hong Kong was consistently voted the world's best hotel in the 1980s and 1990s. Returning the property to its original roots as a Regent hotel is symbolic of our ambition to return the brand to its former glory and will go down in history as one of the greatest brand comebacks in the hotel industry."
• IHG is believed to have put forward a bid, backed by an unnamed property developer, to buy the Principal brand of 12 city centre hotels, according to The Times today. It is one of several company's which are in the runing to buy the Principal Hotel Company (PHC) owned by the American investment firm Starwood Capital Group, which includes the De Vere brand of 15 country house hotels and conference venues. It is said that IHG is only interested in the Principal brand. The price tag for PHC is around £1.2b.