This article has been corrected.
Paul White, the president and chief executive of Orient-Express Hotels (OEH), who led the charge against Tata-promoted Indian Hotels Company Limited accusing it of making a hostile takeover bid, has stepped down.
White, 46, was on the board of OEH. He decided to quit due to personal reasons, ending his 20-year association with the Bermuda-headquartered hospitality chain. IHCL holds about seven per cent in OEH, owning Class A shares with 2.6 per cent voting power.
J Robert (Bob) Lovejoy, chairman of the board, has been named as the interim CEO till the time the seven-member board finds a “permanent replacement”. The board has named a search committee for the purpose, a release stated.
White had been the voice of Orient-Express in 2007 when he made near-racist remarks against IHCL’s overtures of forging a strategic alliance after it picked up 10 per cent stake in NYSE-listed OEH. IHCL runs the Taj chain of luxury hotels.
Following this, the two sides engaged in a much-publicised verbal duel, with OEH refusing to budge from its position saying it did not see any “strategic fit” in partnering IHCL and the latter asking for a public apology from White.
“We do not wish to be involved in an attempt to improve the performance of your non-Indian properties. We believe any association of our luxury brands and properties with your brands and properties would result in reduction in the value of our brands and of our business, and would likely lead to erosion in the revenue per available room (RevPar) premiums currently achieved by our properties,” White wrote to IHCL then.
This strongly-worded response was made after IHCL had sent a letter with six-point alliance proposal after meeting White late 2007.
IHCL's vice-chairman R K Krishna Kumar maintained that the company “was willing to wait for as long as it could take for the board of OEH to change their decision”.
White's departure comes after a major change, both in the management as well as on the board of OEH last month. James B Hurlock, founder and chairman, OEH, stepped down, along with fellow director B Sherwood. Lovejoy replaced Hurlock in June. Also, chairman and CEO of Friendly Ice Cream Corporation, India-born Harsha Agadi, was appointed independent director on OEH's board. Philip Mengel was another independent director.
An email sent to IHCL seeking response on whether White's departure would mean resumption of a dialogue with the OEH management remained unanswered at the time of going to press. OEH are the owners, part-owners and managers of 50 luxury hotels, restaurants, tourist trains and river cruise properties operating in 24 countries. OEH promoters own all of the 18,044,478 shares of Class B which have superior voting rights compared to Class A shares.
Correction
This article had mentioned that Harsha Agadi is former chairman and CEO of Friendly Ice Cream Corporation, while he remains the current chairman and CEO of Friendly Ice Cream Corporation. This has been corrected. The error is regretted.
