HVS E-Newsletter, Asia Pacific - 2 August 2002

29 July 2002 - East India Hotels, owner of the Oberoi chain, has entered into a joint venture with the Kerala Tourism Development Corporation ('KTDC'), called Oberoi Kerala Hotels and Resorts. The joint venture will set up three premium hotels in the state of Bekel, Thekkady and Alleppey at an initial investment of about Rs330 million. The Oberoi group will hold 80% stake in the venture, while the balance 20% will rest with KTDC. During the second phase of fresh capital investment, KTDC would increase its stake to 26%.

29 July 2002 -Thai hotel chain operator, Royal Garden Resort Plc plans to sell THB 1.2 billion ($29.22 million) of five-year bonds in mid-August to refinance its debt. The bonds would be offered to institutional investors, with Bangkok Bank and Thai Farmers Bank as lead underwriters. The other underwriters are National Securities and DBS Vickers Securities. Royal Garden operates hotels under the Marriot and Four Seasons names, and shopping malls in various parts of Thailand.

29 July 2002 -China Land Group, a property and hotel unit of China Strategic Holdings, is buying stakes in two hotels in China and one in Hong Kong in a deal with three firms involving new shares, cash and promissory notes. China Land will issue one billion new shares to Ananda Wing On, and place 1.33 billion new shares at HK$0.30 to help pay for the acquisitions from the three firms. The company has agreed to pay HK$150 million in cash and HK$365 million in promissory notes for Hutchison's 95% stake in Beijing's Harbour Plaza Hotel. The new shares issued to Ananda Wing On will be worth a total of HK$300 million. China Land is buying HK$110 million in assets from the company, including Ananda Wing On's 60% interest in Golden Gulf Hotel in the central Chinese city of Luoyang and some loans. Paul YITC, which owns 17.45% in China Strategic, will sell its hotel Best Western Rosedale on the Park in Hong Kong to China Land for HK$250 million in cash. Hutchison Whampoa Ltd. also agreed to sell its Risdon Ltd. unit to Goldwiz Holdings Ltd. for HK$310 million. Risdon holds a 95% equity interest in the 320-room Harbour Plaza Kunming Hotel in China's Yunnan province. Goldwiz will pay for half the acquisition by issuing HK$155 million of convertible notes to Hutchison, convertible into shares at a price of HK$0.76, fully converting to a 16.11% stake. Despite selling HK$825 million worth of hotels, Hutchison Whampoa said that they are not getting out of the hotel business and this is just an opportunity to streamline the group's hotel portfolio and realign resources.

30 July 2002 - The Korean port city, Busan, will host the 14th Asian Games from September 29th to October 14th 2002. For 16 days, nearly 11,000 athletes from 42 member nations of the Olympic Council of Asia will compete in 38 different events. As host city, Busan's Asiad Stadium will play a key role in this year's Asian Games. In addition to the opening and closing ceremonies, it is included as one of the seventeen venues for the events.

30 July 2002 - Latest figures released by the Hong Kong Tourism Board (HKTB) show that Hong Kong welcomed 1,174,202 visitors in June 2002. Representing a 6.0% year-on-year increase in what is one of the quieter tourist months of the year. For the first six months of 2002, total arrivals have grown by 12.8% to 7,503,103, well ahead of the HKTB's initial forecast of 7.9% growth for the year. Arrivals from Mainland China led the way in June, totalling 423,763, a 25.7% increase compared with the same month in 2001. For the first six months of this year, more than 2.88 million Mainland Chinese have visited Hong Kong, an increase of 43.2%, on 2001. Average hotel room occupancy across all categories was 79% in June, compared with 77% in the same month in 2001. For the first six months of the year, average occupancy stands at 82%, compared with 78% in the first half of 2001. Hotels in the top tariff group have achieved 77% occupancy, while those at the next level rank highest with 85%. Hotels on Hong Kong Island beyond the main Central to Causeway Bay corridor achievied 87% occupancy for the first half of the year.

31 July 2002 - Hong Kong based Mandarin Oriental International Ltd, a unit of Jardine Strategic Holdings Ltd., said that first half profits increased by 16.2%, compared to 2001, but cautioned that global economic conditions were still affecting business and visibility continued to be limited. Mandarin said that second half business is usually stronger for many of their hotels but uncertainty in the global economy continues to affect business and booking patterns remain shorter than usual.

31 July 2002 - The World Tourism Organization announced that the Philippines was declared as the Feature Tourism country in a campaign to be known as "Visit Philippines 2003."

31 July 2002 - According to an article published in the 'The Business Times' Raffles Holdings Ltd. are planning to add hotels in gateway cities such as Tokyo, Shanghai and Hong Kong. As part of a plan to double its rooms to 25,000 in the next three years. There are currently Raffles hotels in six cities. In addition raffles are constructing hotels in Bali and Bintan in Indonesia and Mallorca in Spain. Furthermore, Raffles also has 20 hotels under the Swissotel name, after paying $439 million for the hotel arm of Switzerland's SairGroup, last year.

31 July 2002 - The 690-room Harbour Plaza Metropolis Kowloon hotel has opened for business. The hotel is located next to the Kowloon- Canton Railway Station, and is a short walk from the Tsimshatsui MTR station.

31 July 2002 - All Nippon Airways Co. Ltd. will sell its ANA Grand Hotel Wien in Vienna to London-based JJW Hotels and Resorts for €110 million ($108 million). Gains from the sale of ANA Grand Hotel Wien would be funnelled into free cash flow and be used to reduce interestbearing debts. ANA also has plans to sell its ANA Harbour Grand Hotel Sydney in Australia, with talks in progress on its sale.

1 August 2002 - Shangri-La Hotels and Resorts announces a new management agreement to operate a five-star boutique hotel in Putrajaya, 15 miles south of Kuala Lumpur's city centre and within 12 miles of Kuala Lumpur International Airport. Scheduled to open in October 2002, the 120-bedroom Putrajaya Shangri-La Hotel will be Shangri-La's seventh property in Malaysia.

1 August 2002 - Cheung Kong (Holdings) has secured approval to build a hotel incorporating a split-unit air-conditioning system on the waterfront of Hunghom. The Buildings Department has approved in principle a hotel development that will comprise five 18-storey hotel blocks over a basement, providing a total of about 1,700 rooms. The site, spanning 2.03 hectares, was acquired by Cheung Kong for HK$1.09 billion through an auction last August. The company also paid HK$655 million for a neighbouring one-hectare commercial plot at last October's auction.

2 August 2002 - Far East Hotels and Entertainment Ltd is planning to acquire various three-star hotels in Hong Kong, China and Southeast Asia. The company is also planning to invest in other leisure businesses such as building a holiday resort on Cheung Chau island. The company currently has cash on hand of HK$100 million.

2 August 2002 - Britain's 'The Business' newspaper reported that the Singaporean investment firm BIL International Ltd had given its consent to sell London-based Thistle Hotels, in which it holds a 46% stake. Thistle, London's largest hotel chain and the owner and manager of 56 properties, could be worth up to £750 million (US$1.18 billion), according to the newspaper. Chief executive Ian Burke was also thought to be lining up a £720 million management buy-out bid. Rival hotel group Millennium & Copthorne was said to have approached BIL over Thistle. Other likely bidders included US group Cendant, French hotel operator Accor and Six Continents PLC, according to 'The Business'. However, the Board of BIL International Ltd, said in a press release submitted by the company secretary Jane Tech, that it has not agreed to dispose of its 46% stake in Thistle Hotels.

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