Fairmont is Seeking a Better Offer

Article Excerpt

FAIRMONT HOTELS & RESORTS INC. $49 (Toronto symbol FHR; SI Rating: Average) has rejected an offer from American billionaire investor Carl Icahn to buy 51% of the company’s common stock at $40.00 U.S. a share. Mr. Icahn, who owns 9.3% of Fairmont, may offer to buy all of it at a higher price if the company gives him access to certain non-public information. Meanwhile, Fairmont is talking with other potential bidders. Fairmont continues to pursue its long-term plan to sell hotels, and enter into long-term management contracts with the new owners. Managing hotels generates higher profits for Fairmont than owning them. Fairmont just sold a hotel in Hawaii for a pre-tax gain of $109 million U.S., which is equal to 83% of the $131.8 million U.S. or $1.66 U.S. a share that it earned in the first nine months of 2005. Fairmont also sold some surplus real estate in Toronto for a gain of $8.2 million Canadian. Fairmont is still a hold. hold…

You are trying to access subscriber-only content.

To read this article, you may subscribe or sign in.
If you are already a subscriber, log in here.

If you wish to become a subscriber, click here. Or you may enjoy access to all our publications when you become a Member of Pat McKeough's Inner Circle Pro.