Tycoon lines up bid for Savoy owner…

15 December 2005
Tycoon lines up bid for Savoy owner…

Canadian hotel group Fairmont Hotels & Resorts could be sold to a large hotel company if a bid by a US billionaire financier is successful.

Corporate raider Carl Icahn has announced his intention to make a bid of up to $1.9b (£1.1b) for the Toronto-based hotel company, whose portfolio includes London's landmark hotel, the Savoy.

Icahn, who bought a 9.3% stake in Fairmont in November, wants to take his share in the group to 51%. He then plans to sell the company to boost its value for shareholders.

But an industry expert said that Saudi billionaire Prince Alwaleed bin Talal, who also holds shares and owns some of the real estate Fairmont manages, would be critical in deciding the company's fate.

He said: "If there's a ‘change of control' clause in the Prince's management contracts, he could walk away with his freehold properties - in which case there would be no deal for Icahn." The Prince could make a deal with Icahn, award the management contracts for his real estate to another hotel company or bid for Fairmont himself, he added.

Fairmont's board of directors urged shareholders not to sell their shares until they had made a recommendation. Chief executive William Fatt has previously advised shareholders to reject an offer.

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