Hotel chain spreads wings in Japan

Intercontinental Hotels (IHG) agreed to take a major stake in the hotel arm of All Nippon Airways’ (ANA) today as it attempted to spread its wings in Japan.

Intercontinental Hotels (IHG) agreed to take a major stake in the hotel arm of All Nippon Airways’ (ANA) today as it attempted to spread its wings in Japan.

The Holiday Inn and Crowne Plaza operator already runs 11 hotels in the country and will pay £8m (€123,8m) for a 75% share in the joint venture.

Windsor-based IHG will team up with the hotel management division of the world’s seventh biggest airline to rebrand 13 ANA hotels as Crowne Plazas or Holiday Inns.

There are another 18 ANA hotels under franchise in Japan which will now also be offered the chance to take on the IHG brands.

IHG, which will become the largest international operator of chain hotels in Japan boasting 12,000 rooms, also intends to splash out £10m (€14.m) on advertising and £7m (€10.4m) on new IT systems.

Andrew Cosslett, chief executive of IHG, said: “This deal marks another significant step for the firm as we continue to develop our brands throughout Asia.

“It is consistent with our strategy of expanding our presence in key markets and makes IHG the first international hotel company with a large scale multi brand presence in Japan.”

The Japanese hotel market is dominated by domestic players and has been a tough nut to crack for chains which represent a mere 5% of hotel rooms in the entire country.

However, the new deal will allow IHG to tap into the world’s second biggest hotel market with around 10% of the globe’s hotel rooms.

Mineo Yamamoto, ANA president and chief executive, said: “This is a superb platform from which to strengthen our hotel business, grow co-brands and develop our people, in order to benefit our guests, our shareholders, our employees and our business partners in Japan.”

IHG, which is the largest hotelier in the world, said in August operating profits climbed to £107m (€159.6m) in the first six months of the year.

ANA is a member of the Star Alliance group of airlines and carries almost 50 million passengers each year to 50 destinations around the world.

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