Millennium & Copthorne Hotels plc

International Directory of Company Histories, Volume 71 (2000) by M. Cohen

Millennium & Copthorne Hotels plc

Scarsdale Place, Kensington London W8 5SR United Kingdom Telephone: 44 20 7872 2444 Fax: 44 20 7872 2460 Web site: http://www.millenniumhotels.com

Public Company Incorporated: 1995 Employees: 12,328 Sales: £547.1 million ($1.16 billion) (2004) Stock Exchanges: London Ticker Symbol: MLC NAIC: 721110 Hotels (Except Casino Hotels) and Motels

In less than a decade, Millennium & Copthorne Hotels plc (MCH) has built one of the Asian region's largest hotel groups and has taken a place among the global top 40. The company, based in London and listed on the London Stock Exchange, serves as the international arm of Singapore's Hong Leong Group, and its chairman is Kwek Leng Beng. MCH operates some 90 hotels worldwide, chiefly under the Millennium and Copthorne brand names. The company has positioned itself as an operator of "luxury four-star" hotels, enabling it to differentiate its offering from the crowded five-star hotel bracket, particularly by offering lower room rates. The company's portfolio contains many prestigious hotels in 18 countries, including Indonesia, Singapore, Malaysia, Hong Kong, Korea, and Taiwan, as well as in Abu Dhabi and Dubai in the Middle East. New Zealand is a major market for the company, with 30 hotels, including 15 Kingsgate Hotels. Together, the Asia/Pacific region accounts for 36 percent of company revenues, which neared £550 million ($1.2 billion) in 2004. In Europe, the company operates primarily in the United Kingdom, with nearly 20 hotels, as well as two hotels each in France and Germany. Europe accounts for 31 percent of group sales. The company's North American portfolio targets major city markets in the United States. In late 2004 and early 2005, the company sold off its holdings in two U.S. landmark hotels, the Plaza in New York, and the Biltmore in Los Angeles. The United States remains the company's single-largest market, at 33 percent of sales. After a difficult period in the first half of the 2000s, MCH has announced plans for further expansion, including the opening of as many as 20 Copthorne hotels in the United Kingdom.

Founding an Asian Hotel Leader in the Mid-1990s

The origins of Millennium & Copthorne Hotels traced back to the formation of Singapore's City Developments Limited (CDL), the property development and real estate vehicle of the Kwek family's Hong Leong Singapore. Founded in 1941 by Kwek Hong Png, that company grew into a leading Singapore conglomerate. In 1972, Kwek extended his business interests into the real estate market by acquiring control of CDL, which had already completed several prominent developments in Singapore. CDL had been founded in 1963, and grew into one of the country's largest land holders before beginning its expansion onto the international market.

CDL's interest in the hotel market began only in the late 1980s, when the company acquired its first hotel, the King's Hotel, in Singapore in 1989. That acquisition was followed soon after by the purchase of the city's Orchid Hotel. The company continued to seek new hotel purchases in the Asian region. From the start, the company targeted the luxury hotel market, and by the early 1990s its holdings included the Regent in Kuala Lumpur, the Heritage Hotel in Manila, and the Grand Hyatt in Taipei. The expansion of the company's hotel operations began especially after Kwek Leng Beng took over as head of the family empire following his father's death. CDL began acquiring additional properties in the early 1990s. The depressed real estate and tourism markets at the start of the decade enabled the company to build a strong portfolio of choice sites at low prices.

CDL's first foray outside of the Asian region came in 1993. The company turned to London, buying the Gloucester Hotel. Soon after, the company entered the New Zealand market (destined to become one of the group's core markets), buying a chain of 13 hotels there.

Kwek Leng Beng now took CDL on a spending spree, paying out more than $1 billion over the next three years to boost its hotels portfolio to some 55 hotels, with more than 14,000 rooms, in 11 countries. Among the group's purchases were its first properties in the United States, including the Hilton and the Broadway in New York City, bought in 1994.

CDL boosted its U.K. presence in 1995, paying £219 million for the Copthorne group of hotels, formerly owned by Aer Lingus. That purchase also gave the company hotel properties in Paris and in Germany. Following the acquisition of Copthorne, CDL launched a new hotel brand, Millennium, and began rebranding a number of its assets, including the Gloucester, as well as its French and German hotels.

Also in 1995, CDL became the leading hotel group in New Zealand, boosting its portfolio there to 21 hotels. In the United States, meanwhile, the company became a joint owner of the prestigious Plaza in New York in partnership with Prince Alwaleed bin Talal of Saudi Arabia and Donald Trump.