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Mainland Chinese firm sues IHG over hotel management spat
Beijing, March 28, 2012
 

SANYA Huayu Tourism, a mainland Chinese conglomerate with hotel, retail and property assets, is suing InterContinental Hotels Group (IHG) for RMB 200 million (US$31.8 million) in damages, over claims that the hotel operator mismanaged its property on Hainan Island.

 

Huayu alleges that IHG's China subsidiary, InterContinental Holiday China, progressively racked up more than RMB 200 million in losses after assuming management of the Sanya Huayu Crowne Plaza Hotel in 2005, forcing the hotel owner to suspend the contract halfway into the 12-year term.

 

According to Li Tao, head of Hotel Business at Huayu, InterContinental Holiday China “failed to provide professional hotel management services in accordance with the contract”. “The (IHG) management team fell far below Huayu's expectations and its management of the hotel was a complete mess,” he added.

 

Huayu also accused InterContinental Holiday China of “a series of dishonest behaviors such as high-price procurements, intentionally concealing information, alteration of hotel RGI data, and deliberately causing damage and loss of large equipment” during its tenure.

 

In a report by the South China Morning Post, IHG was quoted as saying that it was unaware of any legal action by Huayu, and that the claims of mismanagement were unfounded.

 

"All accusations in Huayu's so-called statement are completely groundless,” IHG said in a statement. “During the years of co-operation, every decision relating to operation and procurement was discussed by both Huayu and IHG. IHG has always strictly abided by the law and has been completely honest."

 

Keith Barr, IHG's CEO for Greater China, did not respond to attempts by TTG Asia e-Daily for an official comment from the hotel chain.
 
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COMMENTS
Hi to all who may read this, I have work for that HOTEL and I don’t keep a part for IHG if someone believe I will do that but the owner there it's not ready anymore to fallow IHG STANDARDS. That hotel has his years of glory in 2007-2008 and he never has after that not because of the management and all has been change because of the owner’s side and his involvement in hotel operations. Even me I was push out from there same like many other manages not because of poor performance, it was just because of the owner wish. Was very good management there and I say that because in summer of 2008 all of us move to another big project which everybody may say now it is the baggiest 5 star beach front resort in China, and make a good performance there.....same people..... So I ask my self now.....why same management make twice good performance and the owners there they say are not good? Lets take it logic: Mr. .Li Tao was DGM of the hotel for years and all was ok in his time there, now he come out to blame IHG don’t provide good Management that's ridiculous now to say that when he was a member of the team. Second they affirm the Management company spend money of the owner as the article say (Huayu also accused InterContinental Holiday China of “a series of dishonest behaviors such as high-price procurements).For everybody to know in HUAYU CROWNE PLAZA SANYA the second in finance and who approve all the PR orders it is the OWNER REPRESENTATIVE...So all documents pass from his hand...everybody know that....the owner know what he spend to the last RMB.... Another accuse was the Management of the hotel ,,deliberately causing damage and loss of large equipment” during its tenure’’ that hotel was already build damage. I remember in my Departments meeting, after the rain the managers of the sections they report leakage in all most all the area of the departments, my question was during the meeting: now someone to give me the news..Where we don’t have leakage?....of course spend money to repair and maintain the propriety. It was a tremendous challenge for the management o fix and try to find the best way to save cost. Another example we have manage some restaurants in Shopping village an area near the hotel(call La floret) …They do a lot of investments that’s right….designs, FF&E, constructions etc. we pre-open and manage the places and after they take it under their own side to manage…..but if you go now there…that restaurants are not there anymore, or manage by the owner ,all are outsource…..so there is someone in the company with no brain in making business…..I don’t want to be rude in what I say but that’s the real true for what’s happen there. And my examples can go on…. I can say IHG to be happy they go out form that place, was a continuum head each for them. I proud I work for IHG but not so proud for who pay my salary (the owner side) Was a great experience there but in some hotels things happen like that. IHG is still there in the top as a hotel management company and no mater propriety to be lost….that make place for more to come. Good luck for both IHG and Huayu Group
Posted by: LAU LU
29-03-2012 13:03:26
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