Swissotel Merchant Court Hotel May Be Sold Soon

Source : The Business Times, August 6, 2009

TA Enterprise Bhd is proposing to buy both the hotel and its business

Swissotel Merchant Court hotel in the Clarke Quay area is expected to change hands soon. Bursa-listed TA Enterprise Berhad said last week that it's proposing to buy the 476-room hotel.

On the market: The hotel was put up for sale a year ago, but a deal did not materialise then as sentiment worsened due to the global financial crisis

It did not reveal the price but market watchers say that it is likely to be in the mid-$250 million range.

TA Enterprise is proposing to buy both the hotel and its business. The hotel will be sold subject to a management contract with Swissotel, part of Fairmont Raffles Hotels International. Jones Lang LaSalle Hotels is said to be brokering the deal.

TA Enterprise - controlled by Tony Tiah and his wife Alicia - owns Westin Hotel Melbourne, Radisson Plaza Hotel in Sydney and the Aava Whistler Hotel in Canada, according to its website.

In an announcement last week, the group said that it had struck a deal with LaSalle Asia Opportunity II SARL to buy the entire issued shares of Quayside Gem Limited, which owns the hotel and business of Swissotel Merchant Court Singapore.

TA has secured an exclusivity agreement to perform due diligence on the property. The company has paid a deposit of $5 million, which will be forfeitable, if TA withdraws from the negotiations for the proposed acquisition or does not enter into a sale and purchase agreement with the seller by Aug 25, 2009.

During the exclusivity period, the seller will not sell, negotiate or solicit any invitations or bids for the sale of the hotel with any other parties.

Seller LaSalle Asia Opportunity II bought the hotel in 2006 from Fairmont Raffles Hotels International (owned by Kingdom Hotels International and Colony Capital), which had in turn acquired it as part of the entire hotel business of Raffles Holdings in 2005.

The hotel is on a site with a remaining lease of about 84 years. It was put up for sale a year ago, but a deal did not materialise then as sentiment worsened due to the global financial crisis.