Prince Alwaleed Bin Talal Bin Abdulaziz Alsaud
Kingdom Holding Company (KHC), chaired by Prince Alwaleed Bin Talal Bin Abdulaziz Alsaud, announced today Kingdom 5-KR-211, Ltd. plans to acquire all of the 44% total outstanding shares and global distribution systems (GDS) of Kingdom Hotel Investments (KHI) not already owned by KHC.
Kingdom 5-KR-211 Ltd. is one of KHC's wholly owned Cayman Islands-based companies.
KHI is based in the Dubai International Financial Center. Its shares are listed on NASDAQ Dubai and its GDSs on the London Stock Exchange.
Reuters reports the prince's offer has received the unanimous recommendation of the Independent Committee of the directors of KHI.
The offer will be for US $5 per share and per GDS representing premiums of 39.7% and 37.2% to the average trading price for the past three months of the shares and the GDSs, respectively, Reuters reports.
The offer values KHI at about US$843 million.
The offer stipulates a number of standard conditions have to be completed, including receipt of acceptances for the offer of shares and GDSs which, when added to the shares of KHC, represent 75% of the shares and GDSs in KHI.
"KHI has a sound business and strong management team," Prince Alwaleed says in a prepared statement, according to Reuters.
"The offer which Kingdom Holding Company has today announced represents a significant premium to KHI's historic trading price and is structured to provide minority shareholders with short term liquidity at an exit price for cash on terms we believe are highly attractive.
"We are delighted to have already secured the support of the Independent Committee of the board of KHI and of KHI`s largest minority shareholder for our offer. We look forward to the successful completion of the transaction in due course."
In a separate statement, the Independent Committee of KHI said:
"KHI has a proven business model, strong balance sheet and resilient revenue streams from its diverse portfolio of leading hotels.
"The business is performing well despite challenging market conditions.
"However, limited liquidity and low trading volumes have affected and are likely to continue to affect the share price. The offer from Crown allows our minority shareholders the opportunity to crystallize cash value at a premium to the level at which KHI's shares have been trading historically."
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