Speculation surrounding a possible takeover of InterContinental Hotels Group (IHG) continues to fuel the company's phenomenal share price rise.
The rumours have increased IHG's share price by 60p to 1,266p at the time of going to press, with reports that a 1,500p-per-share bid might be in the offing. This would value the group, whose brands include Holiday Inn, Express by Holiday Inn, Crowne Plaza, Staybridge Suites and InterContinental, at £5.7b.
US hotel and property investment company Starwood Capital, run by Barry Sternlicht, appears to be the current favourite to make a bid for IHG, although other investment groups, including Blackstone and Permira, have also been named as possible contenders.
Last year Sternlicht resigned as chairman and chief executive of Starwood Hotels & Resorts. His investment firm, Starwood Capital, then bought Envergure, the second-largest budget hotel chain in Europe, a stake in luxury hotel group Concorde and the French hotel and Champagne group, Taittinger, for £2b.
Since April 2003, IHG's disposal programme has seen 175 hotel properties sold and the return of £2.74b to investors. IHG declined to comment.
By Emily Manson