NRI businessman Mohammed Ali., Galfar group sold Kovalam Beach Resort
in Kerala about Rs 120 crores to Hotel Leela Ventures

Kovalam Beach Resort in Kerala
Le Meridien Kovalam is the first, finest and the largest 5 star beach resort of Kerala, located at famed Kovalam Beach 15km south of Trivandrum City.

Hotel Leela to buy Kovalam resort - Rs 120 crore deal likely to be signed next week

Mumbai June 30, 2005
Prabodh Chandrasekhar
Business Standard


Hotel Leela Ventures will take over the 55-acre Kovalam Beach Resort in Kerala from the M Far group for about Rs 120 crore. The deal is likely to be signed next week, Peter J Leitgeb, president, The Leela Palaces and Resorts, said.

Kovalam Beach Resort is the largest beach resort in Kerala, with over 195 rooms. The resort commands a room rate of over Rs 12,000 per day of stay.

"Leela will buyout Kovalam Beach Resort for a consideration of Rs 90-Rs 120 crore. We will spend another Rs 40 crore on upgradation and renovation of the hotel in two phases,which will begin from August," Leitgeb said.

"It is a good beach and ayurveda health resort. The resort also has a conference hall which can contain about 1,000 delagates. We would like to promote ayurveda during the peak seasons and off-seasons. We would give more emphasis on promoting conventions and exhibitions in the hotel," he added.

The resort is owned by the M Far group, a subsidiary of NRI-controlled Galfar group, and is being managed by the Le Meridien group.

The Galfar group had bought the former ITDC property in July 2002 at Rs 44 crore and renamed it Kovalam Hotels Pvt Ltd, entrusting it to the Le Meridien group.

The acquisition deal, however, excludes the Halcyon Castle which lies adjacent to the resort. The palace, built by a member of the former royal family of Travancore in the 1930s, has been the subject of a dispute over ownership.

Several local groups, including political parties, have argued that the property belongs to the state government and hence could not be transferred to M-Far Hotels as part of the disinvestment process.

The governor of Kerala recently promulgated an ordinance taking over the Halcyon Castle and 4.113 hectares of land appertaining to it from the M-Far Hotels at Kovalam.

The Halcyon Castle is possibly the most expensive resort in Kerala with a room in the castle fetching Rs 15,000 for a single-day occupancy.

Leela buys former ITDC hotel for Rs 120 cr

MUMBAI, JUNE 4: Yet another hotel property disinvested by the government has changed hands. The board of directors of Hotel Leelaventure Ltd on Friday approved the acquisition of Kovalam Hotels Ltd in Kerala for Rs 120 crore.

The 192-room hotel, which was sold by government-owned ITDC for Rs 44 crore in the disinvestment programme in 2002, was purchased from M Far group, a subsidiary of the Galfar Group, headed by NRI businessman Mohammed Ali.

The the 64.5-acre property’s deal has been signed at Rs 120 crore. Mumbai-based Leela group, owned by Captain Krishnan Nair and family, currently operates hotels in Mumbai, Goa and Bangalore. The board also decided to go in for $90 million foreign currency issue/borrowing to finance the acquisition, the company informed the BSE on Saturday. But the deal excludes the Halcyon Castle, which has been caught in litigation. The Marxist-led Opposition in Kerala has been campaigning against an individual appropriating the disputed heritage property.

Galfar had purchased the former ITDC property in July 2002 and renamed it Kovalam Hotels Pvt Ltd, entrusting it to the Le Meridian group for management. The sale of Kovalam Hotels has come in the wake of the controversy surrounding the premium sale of the Centaur Hotel in Mumbai by the NDA government.

Thiruvananthapuram, Sep 28, 2004
UNI
A day after the Kerala government took over the Halcyon Castle and surrounding 4.13 hectare of land at Kovalam, the Revenue officials today sealed two more buildings in the complex that were possessed by the Gulf-based Mfar Group.

The eviction proceedings of 26 more buildings in the land taken over by the government from the hotel group had slowed down a bit today since District Collector Tinku Biswal had given 48 hours time yesterday to remove the articles.

The heritage property was in the custody of the NRI business group after it purchased the adjacent Ashoka Hotel from the ITDC under a disinvestment deal two years ago.

But the public outcry to restore the castle, built by the erstwhile Travancore Royal family, forced the government to take it over. However, the hotel group has challenged the decision in the High Court.

Meanwhile, the authorities clarified that they did not want to put hurdles on the smooth functioning of the Kovalam Hotel.

Any comments on this article or you have any news: Click here

Disclaimer
NRIinternet.com will put up as many of your comments as possible but we cannot guarantee that all e-mails will be published. We reserve the right to edit comments that are published.