InterContinental Hotels to return $1.5bn to shareholders

InterContinental Hotels Group, owner of the InterContinental Dublin, plans to return $1.5 billion to shareholders in the form of a special dividend after selling hotels in Paris and Hong Kong last year. The special dividend will be paid in the second quarter, the owner of the Holiday Inn and Crowne Plaza brands said in a statement on Tuesday.

The company also announced a 10 per cent increase in its final dividend to 85 cents per share and said 2015 operating profit before one-time items climbed 4 per cent to $680 million.

“Our strong momentum in 2015 was driven by a clear strategy,” InterContinental chief executive Richard Solomons said in the statement. “We delivered our highest room openings since 2009, our best signings since 2008.”

InterContinental, which has 727,000 rooms in 100 countries, will lose its ranking as the world's biggest hotel company once Marriott International Inc. completes its acquisition of Starwood Hotels and Resorts Worldwide Inc. later this year.

InterContinental,  based in Denham, England, is under pressure to join a flurry of transactions in the industry as companies combine to cut costs and compete with online travel agents. Investors spent $85 billion on hotel deals last year, 50 percent more than in 2014, according to data compiled by Jones Lang LaSalle.

InterContinental conducted talks with financial advisers about whether to sell itself or combine with a competitor, people with knowledge of the matter said in November. Last year, the company sold the InterContinental Hong Kong for $938 million, and Le Grand hotel in Paris for 330 million euros ($364 million).

Bloomberg