Formosa International Hotels Corp (晶華國際酒店), the nation’s biggest listed hotel operator, said yesterday it had gained shareholder approval to quadruple its expansion quota, as it is expanding into North America and China.
During an extraordinary shareholder meeting yesterday, shareholders gave the green light for a revision to regulations on asset acquisitions.
That move allows the company to increase its investment quota to NT$3.6 billion (US$109.1 million) from NT$900 million.
Formosa Hotels is in talks with a hotel group in North America for a possible buyout, marking its first expansion into that market, company chairman Steven Pan (潘思亮) said.
Real estate value in North America has plunged to a new low amid the global financial crisis and the company expects to seal the acquisition this year, he said.
In contrast with dropping prices in North America, the value of real estate in China is booming and Formosa Hotels said it would work with Chinese developers by providing management expertise rather than buy land to build hotels or merge hotel operators, he said.
In November, the company signed a pact with Hong Kong developer Tomson Group (湯臣集團) to offer personal butler services to the Tomson Riviera (湯臣一品) in Shanghai — one of the most expensive service apartments in China.
This marked the company’s first foray into the Chinese property management business after it won a license to operate US-based Domino’s Pizza in Shanghai, Beijing and Taiwan in December 2006.
The company said it would increase the pizza chain’s presence in Shanghai and Beijing by opening a total of 40 outlets this year, up from 14 at present, its director of public relations Ellen Chang (張筠) said.
In a client note on Feb. 23, KGI Securities Co (凱基證券) advised investors to stock up shares of Formosa Hotels and Ambassador Hotel Ltd (國賓).
With the possibility looming that Chinese tourists visiting Taiwan would no longer be required to do so on package tours, the tourism industry and local hotel operators could benefit in the long term, it said.
Shares of Formosa Hotels edged up close to 1 percent to close at NT$343 in Taipei trading yesterday.
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