Lai Sun set to take control of Furama

The Lai Sun Group is set to announce the purchase of a controlling stake in Furama Hotel Enterprises, owner of the five-star Hotel Furama, in a move which could result in a $6.8 billion takeover bid and the disappearance of two more five-star hotels in Central.

Analysts believe Lai Sun is keen to transform the 24-year old Hotel Furama and possibly the adjacent Ritz-Carlton Hotel - which is owned by Lai Sun Hotels International - into office space.

Sources said Lai Sun Development, whose shares were suspended yesterday along with those of Lai Sun Hotels and Furama, would pay about $3 billion, or $33.50 a share, to buy the 45.2 per cent stake in Furama held by the Adrian Fu family.

The deal, which could not be confirmed last night, was described as 'aggressive' by some analysts who said the price was too expensive when taking into account Furama's net asset value and prospects for the office market in Central.

The price is substantially higher than the $26 at which Furama closed before yesterday's suspension. It is nearly treble the $12.85 level at which they were trading one month ago, before the company announced in early June its major shareholder had been approached by a potential buyer.

Analysts said the price would also represent a hefty premium of more than 45 per cent over Furama's estimated net asset value of $19-$23 a share.