Under a memorandum of understanding signed on 2nd May this year in Dubai between HRH Prince Faisal, PIAC Managing Director Tariq Kirmani and Managing Director PIA Investments Company Ltd. Aslam R. Khan, PIAC will get 100 percent ownership of two hotels, namely, Roosevelt, New York, and Scribe, Paris. The third hotel, which is in Saudi Arabia, the Minhal Holiday Inn, Riyadh will be 100 percent owned by HRH Prince Faisal. PIAC will also pay $40 million to Prince Faisal.
THE PIAC BOARD OF DIRECTORS HAS APPROVED THE MOU: This deal brings to an end the long-standing dispute between the two partners on the operation of their joint venture company with an amicable resolution of the problem to the satisfaction of both, with PIAC undoubtedly emerging as a major gainer. The meteoric rise in property prices in New York City and Paris has added to the value of the Roosevelt and Scribe properties that PIAC would now own exclusively.
The deal is so structured that PIAC will transfer its shareholding in Riyadh Minhal Hotel (which is 24.5 percent) in favour of HRH Prince Faisal bin Khalid bin Abdul Aziz and also pay a sum of 40 million dollars to him in return for the transfer of his entire shareholding (which is 50 percent in each of the New York and Paris hotels) in favour of PIAC.
The Roosevelt Hotel has 1013 Keys that include 47 suites and the rooms were last refurbished in 2003 at a cost of 3 million dollars. Situated on Madison Avenue in the heart of Manhattan, it also has 15 retail tenants occupying about 20000 square feet of retail space. It operates under the legal title of Roosevelt Hotel Corporation Limited Liability Company (RHCLLC).
The Scribe Hotel has 217 rooms and is operated by an international hotel chain 'SOFITEL'. The land and building are owned by Minhal France Societe Anonyme (MFSA); both, RHCLLC and MFSA are wholly owned by Pakistan International Airlines Investment Company Limited, (PIAICL).
PIAICL is a partnership between PIAC and HRH Prince Faisal on a 50:50 basis. The Minhal Holiday Inn Riyadh is owned by Riyadh Minhal Hotel Company Limited (RMHC) of which 51 percent is owned by HRH Prince Faisal and 49 percent by PIAICL. The land on which this hotel is built is not the property of RMHC but it is the personal property of HRH Prince Faisal and RMHC pays one million Saudi Riyals per annum to Prince Faisal as ground rent.