Red Planet Hotels has bought a 16.05% stake in the Tony Fernandes’ budget hotel brand, Tune Hotels.
The company, which is also the existing franchisee of the Tune brand in Southeast Asia – now becomes the third largest investor in Tune Hotels with 9,975,038 shares.
The largest shareholder in Tune Hotels remains Fernandes, founder of the Tune and AirAsia brands. While the financial details of the Red Planet stake have now been disclosed, the companies said it represented a “significant multi-million dollar transaction” and the largest single corporate investment Red Planet Hotels has signed in its two-year history.
Red Planet Hotels’ CEO, Tim Hansing, commented; “This significant investment and commitment to the Tune Hotels brand is indicative of Red Planet Hotels’ well-balanced long-term development programme and provides tremendous value growth to our existing shareholders.
“As we move towards becoming a major owner and operator of Tune Hotels properties, this investment and endorsement of Tune’s board and management allows Red Planet Hotels to participate and contribute constructively and meaningfully for the benefit of both companies.
“Each will reap significant rewards through our investment and I am delighted that Red Planet Hotels’ commitment to Tune Hotels has resulted in us being invited to join its board,” he added.
Tune Hotels currently has a portfolio of 24 budget hotels with more than 3,800 rooms, as well as a pipeline of 38 properties that will include brand’s roll-out in India, Australia and Saudi Arabia, along with boosting the company’s existing portfolio in Thailand, Indonesia, the Philippines, UK and Malaysia.
As Tune’s Southeast Asian franchisee, Red Planet Hotels will operate 10 operating hotels in Thailand, the Philippines and Indonesia by the end of 2012, including new openings in Bangkok, Pekanbaru and Phuket.
