InterContinental Hotels Group Plc shares fell the most in 11 weeks after the world’s largest hotel operator said it’s not exploring a sale or merger.
The owner the Crowne Plaza and Holiday Inn chains dropped as much as 4.5 percent in London trading and were down 3.5 percent at 2,676 pence as of 1:12 p.m. The stock 6.2 percent on Friday after Bloomberg News, citing people with knowledge of the matter, reported that the company was in discussions with financial advisers on whether to sell itself or combine with a competitor.
“InterContinental has solid brand names and a solid balance sheet, and it doesn’t need a large transaction to execute its strategy,” said Matthias Desmarais, an analyst at Oddo & Cie. in Paris who has a buy rating on the stock. “There’s no reason the stock should go down much further than 4 or 5 percent today.”
There has been frequent speculation that InterContinental, which has almost 730,000 rooms, will buy a competitor or merge. The company in July said it isn’t in merger talks with Starwood Hotels & Resorts Worldwide Inc. after the Financial Times reported that negotiations had taken place. In September, the Sunday Times wrote that InterContinental was nearing a deal to buy Fairmont Hotels & Resorts.
Starwood, owner of the Westin and St. Regis brands, hired an adviser earlier this year to help explore strategic options and CNBC reported that the company is the target of an approach by Hyatt Hotels Corp.
“Following recent market speculation, the board of directors of IHG states that it is not considering a potential sale or merger of the company,” the Denham, England-based company said on Friday.
This article was written by Dalia Fahmy from Bloomberg and was legally licensed through the NewsCred publisher network.