The Abu Dhabi Investment Authority (ADIA) will be buying around 42 Marriott International hotels that are controlled by the Royal Bank of Scotland (RBS). The AIDA will pay around $992 million for the hotels.
Defaulting owners forfeited the hotels to RBS in 2011. It then held an auction to sell off these properties. The auction of these hotels has been running for several months now and is expected to be concluded in the coming weeks, reports Bloomberg.
The 42 hotels include four and five star hotels located across England, Wales and Scotland. The forfeiture has not affected operations and staff of the hotels as these properties are under a 30-year-contrcat of management with Marriott International. The contract was made in 2006 and will expire only by 2036.
The hotel portfolio includes some of the famous hotels like, The Marriott Country Hall, Dalmahoy Hotel, St. Pierre Hotel and the Heathrow Hotel.
According to the Sunday Times, AIDA and Qatar Investment were bidding vigorously for the hotels in July 2012. In August 2012, rumors were out that the highest bid was received from Qatar Investment Authorities as it had made an alliance with an Indian hotel chain, Blue Coast, which would be paying half the amount. However, the deal was put on hold as the alliance failed to conjure up the capital by the given deadline.
The bid is likely to go in favor of AIDA as news of the alleged purchase deal has leaked out, reports Bloomberg.
The AIDA is a sovereign fund started in 1976. The fund was created to invest on behalf of the Abu Dhabi government into various sectors. AIDA owns about 7 percent of the world's oil reserves. The fund hopes to diversify into retail business with the purchase of the hotels, reports Bloomberg.
Qatar Investment is a much newer investment fund. Founded in 2005, the fund has many subsidiaries. In January 2013, Qatar Holding, a subsidiary of Qatar Investment, announced that it will be investing around $5 billion in Malaysia to fund its petrochemical projects.