InterContinental share price rises after hotel group rejects Marcato report suggesting merger would see share price double

 
Ollie Gordon
The InterContinental Hotel in Buenos Aires is one of 4,500 IHG hotels worldwide
Activist US hedge fund Marcato Capital Management yesterday lit a fuse under the independence of British hotels giant InterContinental Hotels Group by calling for the firm to actively seek a merger, claiming it could double its share price.

The San Francisco-based Marcato also publicly released a report it had commissioned from LA-headquartered financial advisers Houlihan Lokey supposedly proving the strategic value of a merger.

Marcato said that the evaluation showed that joining forces with a rival hotel could double IHG’s share price. The company said: “Marcato found that an equity combination could deliver a premium upwards of 100 per cent over IHG’s current share price.”

IHG released a response, saying it had rejected the proposal after analysing the report. IHG shares rose 3.42 per cent to 2,537p.

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