Du Shuanghua will be ready for anything that Paris can dish out
A company linked to controversial China steel tycoon Du Shuanghua has agreed to buy an international hotel along Paris’ historic Champs-Elysee for 344.5 million euros ($468 million).
Hong Kong-listed Kai Yuan Holdings Ltd (1215), whose primary business is investment in steel producers and real estate announced yesterday that it had agreed earlier this month to buy the Paris Marriott Hotel Champs-Elysees from current owner Tamweelview European Holdings SA.
As part of the transaction, the holding company which was formerly known as the Guoxin Group, arranged to borrow $280 million from Du, who holds a 5.54 percent stake in the company after it acquired his Rizhao Steel Holding Group in 2010.
With a fortune estimated at more than $1.2 billion as of 2010, Du has been ranked among China’s richest men, and made headlines that same year when he was the surprise witness in the Rio Tinto bribery trial.
In his court appearance, Du admitted to being a source of more than $9 million in bribes paid to employees of the Australian mining company which was accused of unfair practices in China.
The billionaire was back in court in 2012 when it was revealed that he had secretly divorced his wife in 2001, without her knowledge. The secret separation was revealed when Du’s wife filed her own divorce petition, only to be informed that her marital union had been surreptitiously resolved at Du’s request 11 years earlier.
Kai Yuan Part of Hotel Buying Spree
According to a report in Bloomberg, the French hotel is Kai Yuan’s second major acquisition in the last six months after it spent HK$488 million ($63 million) to snap up a 32-storey hotel in Hong Kong during December last year.
Besides Kai Yuan, other Chinese investors have been on the lookout for hotels overseas.
Dalian Wanda, which has developed many hotels in China, has already put together $1 billion hotel projects in both New York and London, and a market analysis report released in February by international real estate advisor Savills, predicts that Chinese investors will increase their share of global cross border hotel acquisitions from the current level of 4% to 10% by 2017.
The report predicts that the Asia Pacific region and the UK, particularly London, will be the primary beneficiaries of this investment trend, which it finds to be driven in large part by the expansion of Chinese overseas tourism.
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