Dubai International Capital (DIC), the private equity arm of Dubai Holding, has exited its investment in Ishraq Dubai, which owns many hotels in the UAE, by selling it off to the Dubai-based Almulla Group, a diversified private business group.
In a joint media statement on Sunday, the companies said Ishraq Dubai was 51 per cent owned by DIC and 49 per cent by Ishraq Gulf Real Estate Holding, which in turn is majority owned by DIC. The sale is another in a series of successful exits made by DIC this year.
“The successful sale of Ishraq Dubai follows a strong series of exits that have consolidated our private equity track record in the Mena region,” said David Smoot, CEO of DIC. “The sale of Ishraq Dubai is an important achievement as this represents a strong return from our only ‘greenfield’ investment, a venture which we launched back in March 2005,” he added, without divulging the financial terms of the deal.
“2011 has seen the profitable sales of our stakes in KEF Holdings in June and Oger Telecom in August, as well as the sale earlier this year of Cegco and Kingdom Electricity by our investment vehicle Jordan Dubai Capital. Together these asset sales demonstrate how we have consistently added value to our portfolio businesses and realised maximum value from investments at the right time,” Smoot said in the statement.
Ishraq Dubai owns four hotels in Dubai operating under the franchised Holiday Inn Express (HIEX) brand, located in Dubai Internet City, Al Safa, Jumeirah and at Dubai International Airport Terminal 3. HIEX is InterContinental Hotels’ ‘limited service’ brand, targeting the price-conscious business and leisure travellers seeking quality lodgings at affordable rates.
Almulla Group has reiterated its intent as a strategic investor and operator to strengthen the Holiday Inn Express franchise by improving and sustaining the scale of its operations in Dubai.
Saeed Almulla, chairman of Almulla Group, said: “We have a long and successful track record of owning and managing major four- and five-star hotels across Dubai and the Holiday Inn Express hotels will complement our current portfolio.
This acquisition is in line with our strategy to diversify our current hospitality portfolio to include the budget 2- and 3-star hotels category.
“We already have a relationship with InterContinental Hotels Group and the Holiday Inn Express brand enjoys a strong reputation amongst business travellers in Dubai. Our aim is to ensure continuity and consistency of service delivery and we welcome the staff and professionals of the HIEX hotels to Almulla Group and look forward to working with the current hotel management teams to develop and grow this brand even further.”
Almulla Group boasts of an integrated business portfolio spanning healthcare, hospitality, luxury goods, real estate, and travel & tourism. These include names like American Hospital Dubai (healthcare), Ritz Carlton Dubai, Sheraton Dubai Creek Hotel & Towers, Crowne Plaza Dubai (Deira), the Ramada Dubai and the Ramada Jumeirah (hotels), and Breitling (watches).
Maissan Al Maskati, chairman, Ishraq Gulf Real Estate Holding and managing director, private equity, DIC, said: “We have developed the Holiday Inn Express brand in Dubai and it has become synonymous, as it has in other parts of the world, with reliability and quality. We are proud that these hotels have performed well through the market cycle proving the long term viability of the 'limited service’ concept in the region. Importantly we have found in the UAE’s Almulla Group a very reputed and experienced owner of hospitality assets and one that will be able to drive future value from this well positioned and established hotel portfolio.”