IFC to invest $21 mn in SAMHI Hotels

International Finance Corporation (IFC) plans to make an equity investment to the tune of $21 million in SAMHI Hotels Private Ltd (SAMHI). The investment will support company’s investment plan to the tune of $84 million. SAMHI’s hotel properties are operated by major global hotel operators like Accor, Marriott, Hyatt and Starwood under their brand names.

Privately-held SAMHI’s two largest shareholders are Singapore-based Blue Chandra Pte Ltd, a subsidiary of Equity International Fund V and Mauritius-based GTI Capital Alpha Private Limited, with combined equity shareholding of approximately 95 per cent.

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SAMHI entered into two joint ventures with international hotel operators Marriott and Accor. SAMHI JV Business Hotels Pvt Ltd (SAMHI JV), (67 per cent held by SAMHI and 33 per cent by Marriott through Luxury Singapore Holding Company Pte Ltd) focuses on development of midscale brand “Fairfield” across India along with other Marriott owned brands.

Barque Hotels Private Limited (Barque) (held 60 per cent by SAMHI and 40 per cent by Accor through AAPC Singapore Pte. Ltd) is an SPV currently developing a portfolio of 17 low-budget economy hotels (4 already operational) with planned room inventory of around 2000 across various cities in India. All the properties under Barque are managed and operated by Accor under its global “Formule1” brand (F1).

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SAMHI plans to invest around $84 million, including estimated equity investment of around $38 million, and $46 million of debt. IFC plans equity investment would be upto $21 million, according to IFC project disclosure.

SAMHI presently implementing its growth plan, through development of a portfolio of 27 hotels, including seven operational, 17 under development, three more acquisitions in pipeline, comprising around 4,000 rooms). The financial closure for debt and equity component for this identified portfolio is mostly complete. SAMHI intends to develop/acquire hotel assets across India including in Tier I and Tier II centres.

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The company is also exploring opportunities to add around 10 more assets (around 1,500 rooms) to the portfolio.

These assets would primarily be in the midscale segment but some could be developed or acquired in economy/budget segment. This may encompass the development of roughly 5 new greenfield hotels, and may also include acquisition and/or rebranding of roughly five brownfield properties.

“However, the exact mix will be determined depending on the opportunities opening up to the Group going forward,” said IFC, adding that IFC re-inforces the stamp of approval for the Company as an internationally recognised investor and act as a catalyst for the Company’s future IPO/capital raising plans.

IFC to invest $21 mn in SAMHI Hotels