Reliance Industries has purchased the Mandarin Oriental Hotel New York, a five-star hotel in midtown Manhattan, through the purchase of its Cayman Islands-based parent.
A major player in the city’s real estate and hospitality markets. Reliance, through its wholly-owned subsidiary Reliance Industrial Investments and Holdings, will pay $98.15 million for 73.37 percent ownership of the hotel, according to a late-night statement on Saturday. It will also assume its liabilities over $115 million, according to sources, bringing the total deal value to close to $270 million.
Future Plan
If its other shareholders want to exit the property, RIL would look to purchase the remaining 27 percent of Mandarin Oriental. If the hotel’s other owners choose to participate in the sale, Reliance would procure the remaining 27 percent at the same valuation as the 73 percent stake, according to the filing.
The Columbus Circle Hotel, with 248 rooms and suites, is one of the city’s uber-luxury accommodation businesses, rising over Central Park in midtown Manhattan and favored by Hollywood stars and hedge fund billionaires.
The acquisition will expand RIL’s consumer and hospitality footprint, which already includes investments in EIH Ltd, Stoke Park in the United Kingdom, and the growth of a convention center, hotel, and controlled residential areas in BKC Mumbai. The deal is scheduled to be completed by the end of March.
Mandarin Oriental History
In 2020, the Mandarin Oriental, New York, which opened in 2003, had a revenue of $15 million. It made $115 million in revenue in 2018. The property is near the Pierre Hotel in New York, which is owned by the Tata Group.
RIL’s Consumer Offering
RIL’s quick transition into consumer offerings is highlighted by the purchase of The Mandarin Oriental, New York, which is yet another high-end foreign brand. The business paid $70 million in April for the Stoke Park estate in the United Kingdom. It bought the struggling UK toy store brand Hamleys in 2019 and is turning it around.
With a net worth of $903 billion and a recent $6 billion loan raising, Ambani is leading a shift as he attempts to turn consumer and telecom services into an equivalent foundation for RIL, lowering reliance on earnings from its conventional energy industry, according to Forbes. The purchase of well-known worldwide brands exemplifies this technique.
