Thursday, October 18, 2007

Dubai Group Looks To Court Orient-Express (OEH)

Orient-Express Hotels Ltd. (NYSE: OEH) has a lot of unwanted suitors. Will the company be forced into a deal?

In a 13D filing, released this afternoon, Dubai Investment disclosed a 9.2% stake in the company and said it offered $60 per share to acquire the company, which it said was rejected.

Dubai Investment said it has been aggressively acquiring shares in Orient-Express following disclosure from another group, The Indian Hotels Company, that it holds a large stake in the company and was interested in a deal.

Orient-Express issued a public statement on the Indian Hotels deal, saying it was not interested.

Dubai Investment said if a third party makes an offer for the company, they may counter.

From the filing:

The Reporting Persons and their affiliates have been following the Company for a period of time as a potential investment or business combination opportunity. On several occasions in the last few months, representatives of the Reporting Persons have contacted the Company regarding the development of a joint strategy and possible transaction involving the Company and the hospitality assets of Jumeirah Group, an international luxury hotel chain and an affiliate of the Reporting Persons. In that connection, on September 10, 2007, an affiliate of the Reporting Persons proposed to the Company a transaction in which an affiliate of the Reporting Persons would have, subject to the approval of the Company’s Board, acquired all outstanding Class A Common Shares at a price of $60 per share in cash. The Company responded that it had no interest in pursuing such proposal.

Subsequently, another shareholder of the Company reported the acquisition of 10% of the Class A Common Shares and indicated its interest in a strategic transaction involving the Company. After the Company publicly announced that it had no interest in entering into a transaction with the shareholder, the Reporting Persons began acquiring the Shares in order to prevent this other shareholder from acquiring a significant stake in the Company. If a third party makes an offer for the Company or enters into an agreement with the Company or any affiliate thereof to acquire all or a majority of the capital stock or assets of the Company, the Reporting Persons may consider making an offer to acquire control of the Company, subject to its consideration of all relevant factors and circumstances (such as the price offered by the third party, the condition of the business of the Company at such time, and any other factors and circumstances that the Reporting Persons may consider relevant at such time).

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