The Colony Capital-backed hospitality company, Fairmont Raffles Hotels International, is in the process of selling the historic Raffles Hotel in Singapore to Qatari Diar in a deal worth $275 million, according to the UK Times newspaper.
News of the iconic hotel’s possible sale comes just three days after Qatari Diar, the real estate arm of the Qatar sovereign fund, teamed up with investment firm Voyager Partners to buy a 40 percent stake in the Fairmont Raffles company for an estimated $847 million. The deal made Qatari Diar the largest shareholder in the hotel group.
Kingdom Holding Company, which took Fairmont Raffles private in a $5.5 billion deal with Los Angeles-based Colony Capital in 2006, stated at the time of the equity infusion that Voyager and Qatari Diar paid part cash and “other considerations” for the stake. Qatari Diar and Voyager will also allow Fairmont Raffles Hotels International to manage a number of its hotels in the future.
The terms of the Raffles’ sale reportedly include a long-term management contract allowing Fairmont Raffles to continue to run the Singapore hotel for the foreseeable future. It is believed that the Qataris have yet to pin down the amount of money required to refurbish the landmark hotel, according to The Times.
The 123-year-old Raffles Hotel had secretly been put up for sale roughly a year ago by Prince Alwaleed Bin Talal, the Saudi billionaire who controls Kingdom Holding Company.
In May 2008, Colony Capital agreed to sell the hotel to a consortium led by former Credit Suisse banker Mark Pawley for $650 million, but that deal fell through the following month.