IHG Is Buying Regent Hotels And Hong Kong Is Getting Its Regent Hotel Back | Forbes.com

This morning's announcement that InterContinental Hotels Group (IHG) is acquiring a 51% stake in Regent Hotels & Resorts for $39 million in cash on the surface is a microscopic transaction, bringing aboard a mere six hotels and a pipeline of just three more properties. IHG already has over 5,000 properties, many under budget and cookie cutter brands such as Holiday Inn, Staybridge Suites and Crowne Plaza. From a financial perspective, in 2014, IHG paid $430 million in cash to acquire management contracts for Kimpton's 62 locations. Marriott International's purchase of Starwood Hotels and Resorts was pegged at $13 billion.

For IHG, which said it wants to grow the brand to 40 hotels and 10,000 rooms, the deal is significant because it finally gives the group a true 5-star flag to compete against The Ritz-Carlton and St. Regis of Marriott International, Hilton's Waldorf Astoria, Park Hyatt and Four Seasons, which operates as the biggest monobrand luxury player. It also gives IHG a better proposition to hotel owners and developers as it competes for management deals with other fast-expanding uber luxury names such as Accor's Raffles, Dorchester Collection, Shangri-la Hotels and Resorts, Mandarin Oriental Hotel Group, and New World's Rosewood Hotels & Resorts.