Nov. 28--Six Continents Hotels, one of the world's largest hotel groups, has exited its partnership with Bangkok Intercontinental Hotels Co (BIHC), the operator of Siam Centre and Siam Discovery shopping malls, after it became apparent that it would not be part of the new Siam Paragon development. 

BIHC is a partner along with The Mall Group in the 12-billion-baht Siam Paragon project, currently being developed on the site of the demolished Siam Inter-continental Hotel opposite Siam Square. 

Six Continents, which owns the Inter-continental and Holiday Inn brands, on Tuesday sold its 4.68 million shares in BIHC for 927 million baht to MBK Development Plc, the operator of the Mahboonkrong centre just 200 metres from the Siam Paragon site. 

Six Continents had been the single largest shareholder in BIHC, with 28.58 percent, and its involvement dated back 36 years ago when it began running the former 400-room hotel on a 72-rai plot next to Sra Pathum Palace in Bangkok's Pathum Wan area. 

The sale of Six Continents' stake in BIHC confirmed that the former was not in the running to operate the new hotel planned for the Siam Paragon site, said a source to the deal. 

BIHC executives said the company was negotiating with a number of global hotel chains to run its new property at Siam Paragon. 

Industry sources said the two front-runners appeared to be Kempinski of Germany and France's Accor group. 

Chadatip Chutrakul, chief executive of BIHC and Siam Paragon Development Co, could not be reached for comment yesterday. 

But top executives of BIHC and MBK are scheduled to make an announcement related to the Six Continents-MBK deal this afternoon. 

Six Continents is currently looking for a site in the Ratchadamri and Wireless Road area for a new Inter-continental. 

There were earlier reports suggesting that Six Continents had held talks with the Srivikorn family to rebrand the two Meridien hotels the family owned near the Ratchaprasong intersection. 

But family patriarch Chalermphand Srivikorn denied the reports, telling subordinates recently that he would continue the relationship with the Meridien group. 

The sale of Six Continents' holding has made MBK the largest shareholder in BIHC, with a 30.60 percent stake, up from only 2.02 percent previously. 

BIHC is looking at a deluxe hotel brand to match the top-end image it is trying to project at the Siam Paragon site, which is scheduled to open in 2005. "They seem to be looking at a Ritz class of hotel," an industry source said. 

MBK paid Six Continents a premium for BIHC shares over the book value of 56.23 baht, to complete the acquisition of one of the country's top shopping and hospitality service assets. 

Its holding would also help MBK expand its retailing business horizon and find a synergy with the MBK centre, an industry source said. 

The other major shareholders in BIHC are the Finance Ministry (21.74 percent), Ladawal Investment Co (11.06 percent), Siam Commercial Bank (10.08 percent) and minor shareholders (12.58 percent). 

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