Orient-Express’ Focus Is On Growing Earnings
Orient-Express Hotels Ltd., the Bermuda-based global property owner that rejected a takeover offer from Indian Hotels Co. last year, is focusing on increasing profits and its share price before considering mergers, according to its chief executive officer.
John Scott, hired in November after the Bermuda company rejected the Indian Hotels bid, is renovating and expanding Orient-Express’s portfolio of more than 30 luxury hotels along with trains, riverboats and restaurants that include the Copacabana Palace in Rio de Janeiro and the Venice Simplon-Orient-Express train.
“My job is to make sure we have a solid business model and that we are growing earnings and getting our stock price up,” Mr. Scott told the Bloomberg financial news service this week [June 3]. “If we do that, it leads to opportunities. Then we can look at mergers and acquisitions more aggressively. If approached at that point, the board would take it seriously.”
Indian Hotels, in collaboration with other entities associated with Mumbai-based Tata Group, in October offered to buy the 93.1 percent of Orient-Express it doesn’t already own for $12.63 a share.
The unsolicited bid was 43 percent higher than Orient-Express’s 20-day average price at the time, a record premium for the industry, according to data compiled by Bloomberg.
Orient-Express peaked at $64.80 in October 2007, before the global financial crisis, and has since plunged more than 80 percent.
