Regal Hotels International Holdings chairman and managing director Lo Yuk-sui said after the firm's annual general meeting yesterday the company hoped soon to make an announcement about a joint venture which would see the company establish hotels in a number of cities in China. 'China is our priority,' Mr Lo said. 'We are working hard on some acquisitions of hotels and we are still negotiating on the management side,' he said. Mr Lo said the hotels to be included in the chain were already up and running. He said Regal Hotels would manage them and take out an equity stake in their operation. 'We will modify them a bit, renovate them and upgrade them a bit,' he said. 'Some of them are in pretty good shape already.' Mr Lo said Regal Hotels did not plan to begin any new construction in China. He said the company had not yet decided on redeveloping its Regal Airport Hotel at Kai Tak. 'The area is still growing and there is more and more development going on,' he said. 'Maybe there will be a need for a hotel when the airport is gone.' He said if the height restriction in the area was lifted, 'we would review things in due course'. 'But that is a few years down the road and there is no urgency to make that decision now.' Mr Lo said the firm was still working on a United States initial public offering of its Richfield Holdings, which owns and manages a string of hotels throughout North America. 'The US is more complex so this is not finalised yet,' he said. Mr Lo defended the recent merger of Paliburg Development and Paliburg International Holdings. He said the merger meant the companies involved would not have to sell property when the market was poor and they would be providing recurrent rental income. 'We now have more possibilities in our portfolio to cope with the present volatility in the market,' he said. Mr Lo said the company was keen to build more hotels in Hong Kong both at Chek Lap Kok and 'certainly above the MTR stations'.