InterContinental Could be Takeover Target Suggests Report

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. October 14, 2008

LONDON, UK, December 15, 2005. A report out of London by Reuters is suggesting InterContinental Hotels Group Plc could be a takeover target of various U.S. based chains because of its low valuation.

IHG, which umbrellas InterContinental, Crowne Plaza and Holiday Inn hotels, among others, is moving toward being a managed and franchised hotel operator, but Reuters reported analysts have warned that unless it closes the valuation gap with its U.S. hotel rivals it could find itself in a takeover battle. IHG responded it is focusing on increasing room numbers, saying it has received no takeover bids.

"We have received no offer of any description," said Chief Executive Andrew Cosslett in an interview with Reuters. Cosslett said the valuation gap of around 20%-25% was beginning to close, and as the group was very focused on growth it hoped it would get recognition from the stock market.

Cosslett in September set a target to gain a net 50,000 to 60,000 rooms by 2008- three times the growth it has seen over the last five years- with particular emphasis on China.

"China is our primary focus. It is the biggest opportunity in the industry," he said. The group currently has 47 hotels in China and intends to have 125 operating in three years' time.