Hyatt wrote to NH Hotel’s board about a possible bid proposal on July 26. Two hours later, Minor International Pcl disclosed that it controlled 44 percent of the Spanish company’s shares. Bangkok-based Minor in June said it would make an offer for all of NH Hotel after agreeing to buy a stake from China’s HNA Group Co.
“Based on the information we now have, we believe that the path to a successful tender offer by Hyatt under the terms expressed in our letter has narrowed to a point of being impractical,” President and Chief Executive Officer Mark Hoplamazian said in letter dated July 29 that was disclosed to Spanish regulators by NH Hotel.
Hyatt wrote to NH Hotel saying it was interested in acquiring the company, Bloomberg News exclusively reported last week. The potential tender offer would “powerfully shape the European hotel landscape,” Hoplamazian said in the letter. Dillip Rajakarier, Minor’s chief operating officer, said in a July 27 interview that Hyatt’s interest in acquiring NH Hotel had come too late to stop its own offer from succeeding.
“Hyatt miscalculated the whole thing,” Rajakarier said by phone Monday. “We are confident in our process and our plan.”
NH Hotel fell as much as 7.1 percent in Madrid, the biggest drop since Feb. 6. The shares were down about 6 percent at 6.35 euros at 1:20 p.m, giving the company a market value of about 2.5 billion euros ($2.9 billion).
Minor’s offer for the portion of NH Hotel it didn’t own was valued at 1.64 billion euros ($1.92 billion) in early June, when the plans were first announced.
Hyatt reiterated in the July 29 letter to NH Hotels that it believes Minor’s bid undervalues the company. If NH Hotel “wishes to open a dialogue with Hyatt to pursue other potential paths to unlock value for NH shareholders, we stand ready to do so,” the U.S. firm said.
Founded in 1978 when it opened its first establishment in Pamplona, Spain, NH Hotel Group now operates more than 370 hotels worldwide. Bangkok-based Minor was formed more than a decade ago and is one of Thailand’s largest hospitality and leisure firms, with more than 160 hotels and resorts, 2,000 restaurants and 400 retail locations, according to the company’s website.
–With assistance from Rodrigo Orihuela.
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