Midroc offers $18m for the Sheraton Hotel

MIDROC yesterday won the bid for the Sheraton Kampala Hotel after offering $18m for the 100% Government shares, reports Yunusu Abbey. The Saudi-owned Midroc, Muhammad Investment Development Research Organisation Company, was declared winner after its financial proposal was opened in Kampala yesterday. Its bid price was submitted on Wednesday and taken to Standard Chartered Bank for safe custody. Manzi Tumubweine, the state minister for privatisation, declared Midroc winners after opening their financial proposal. Under the deal, the US $18m payment has to be made not later than three months from yesterday. "I can now announce that Midroc has complied and won the bid. I congratulate them," Manzi said at the Privatisation Unit head offices, venue of the function. The company, which tendered for the Sheraton as Midroc Ethiopia Private Co. Ltd., belongs to a Saudi tycoon, Sheikh Muhammad Al-Amoudi. Midroc remained the sole bidder after South Africa's Southern Sun Hotels, Resorts and Inns, Cresta Hotels and Kharafi & Sons from the Middle East pulled out for unclear reasons. Michael Opagi, the Privatisation Unit director, said the reserve price was US$14m about sh26b. He said Midroc's offer was well above that price. Opagi said Midroc's technical proposal was also satisfactory. He said the company named Citi Bank as their bankers from where a bid bond of $1m would be drawn. Midroc said it would give the management contract to Starwoods Hotel, the current managers of the hotel. Kampala tycoon Karim Hirji's Grand Imperial Hotel had won the deal which the IGG later revoked. Mr. Vijay Vijeyakumaar and Mr. Khalid Qadeer, a financial consultant, represented Midroc, said Midroc would inject $15m in renovating the 250-room hotel. He said Sheikh Al-Amoudi gave him the power of attorney effective May this year, to handle the Sheraton deal. "Our victory is not a surprise. In 1998, Midroc did not fail to raise the money ($17m) as had been alleged. The problem was just over legal matters," he said. "Sheikh Al-Amoudi is a multi-million investor who could not fail to raise that money," he added. Ends.