AIM-listed Myanmar Investments International Limited is foraying into the tourism industry through a joint venture with local entrepreneurs. Meanwhile, the upcoming Heritage Kempinski Hotel Yangon, currently being renovated, is aiming for a February 2018 soft opening.
AIM-listed MIL forges JV for tourism
Myanmar Investments International Limited (MIL) has entered into a joint venture with local entrepreneurs U Thet Lwin Toh and Daw Lwin Lwin Kyaw to invest in tourism-related assets.
The agreement will see the establishment of a joint venture company, Myanmar Voyages Holding Company Limited, which will acquire 60 percent of Myanmar Voyage International Tourism Company Limited (MVI) founded by the two local partners. The JV company will look to make additional acquisitions in the tourism space.
Founded in 1996, MVI focuses on inbound tourism from markets like Spain, Scandinavia and Japan. It also provides land excursion tour packages for cruise liners.
“We are delighted to form this joint venture with such knowledgeable partners who have such well-established track records. Myanmar Voyages provides a solid foundation for MIL’s entry into the tourism sector in Myanmar. Compared to countries such as Thailand and Cambodia, tourist arrivals into Myanmar are currently significantly below their potential, especially given the range of tourist destinations and attractions which exist,” said Aung Htun, managing director of MIL.
In addition, Myanmar Voyages will also acquire from MVI the hotel management right to run the Serenity Inle Resort, located east of Inle Lake. Contracts are expected to be signed within the next two month.
Myanmar Voyages will also buy a 30 percent stake in Culture Attractions Limited, the operator of the “Mingalarbar Balloons” in Kandawgyi Park in Yangon which started operations in May 2017. The other 40 percent stake will be held by the Myanmar partners and the rest by an independent third party.
MIL will initially acquire a 97 percent interest in Myanmar Voyages for about $800,000.
Based on the audited net asset value of MVI businesses and future EBITDA of the acquired MVI business, payments are to be made by MIL, expecting the aggregate consideration not expected to exceed $2.3 million.
MIL’s previous investments include microfinance firm Myanmar Finance International and telecom firm Apollo Towers. In May 2017, it also made an initial investment of $495,000 to establish Medicare, a modern pharmacy, health and beauty retail franchise.
Kempinski Yangon aims for Feb 2018 soft opening
Germany-based Kempinski Hotels, together with other investors redeveloping the heritage building in Yangon into an international hotel under the brand Kempinski Yangon, is aiming for a soft opening around the end of February 2018, according to an executive from a company developing the work.
The Heritage building in Yangon, a former Police Commissioner’s office, is being developed by Kempinski Group, Thailand’s Kanok Furniture and Decoration, and local company Jewelry Luck Group Myanmar. The hotel will feature 239 rooms and suites including other facilities.
“Heritage Kempinski Yangon, once it’s completed, will be the largest heritage building that has been repurposed and opened for commercial use,” said Supalak Foong, managing director of Prime Residence and Heritage Kempinski Hotel Yangon, which is a joint venture of Kanok and Jewelry Luck Group.
In 2014, the project received $60 million in financial support from Siam Commercial Bank but further financing was not disclosed.
The renovation of the heritage building will be the second project in Myanmar for Kempinski. The first one, the Kempinski hotel in Nay Pyi Taw, was opened in August 2015.