SINGAPORE - In its second deal Down Under in recent weeks, Far East Orchard has agreed to look into setting up a joint venture firm with a leading Australian hospitality firm.
The Singapore-listed Far East Orchard said the proposed joint venture could help transform it into a significant regional player.
Under the plan, the joint venture would own the hospitality management business of the Toga Group and its hospitality assets in Australia.
Far East Orchard, a hospitality operator that is part of Far East Organisation, would subscribe to shares in the joint venture firm.
The firm would also explore acquiring from the Toga Accommodation Fund (TAF) a 100 per cent interest in two hotels and three serviced apartments in Australia.
The Toga Group is one of the largest hospitality operators in Australia, with contracts to operate 50 hotels and serviced apartments in Australia, New Zealand, Germany and Denmark.
TAF, of which the Toga Group owns 20 per cent, is an unlisted property fund that invests in serviced apartments and hotel assets in Australia and Europe operated by the Toga Group.
Late last month, Far East Orchard said it had signed an agreement with Straits Trading to acquire its hospitality management business and 50 per cent interest in three Australian hotels.
Far East Orchard chief executive officer Lucas Chow said in a statement yesterday: "In the event that the transactions under both memorandums of understanding are to proceed, it will allow Far East Orchard to establish itself as a regional hospitality operator and owner with a sizeable overseas network, including a potential
investment portfolio of eight hotels in Australia."