Himachal gets record bid for Wildflower Hall hotel operations

Shimla, Oct 30 (PTI) The Himachal Pradesh government on Friday said it has secured "an unprecedented revenue-sharing bid" for the operation and management of its prestigious Wildflower Hall Hotel, Shimla.

     The e-auction to seek bidders for the licence to operate and manage the hotel of the Himachal Pradesh Tourism Development Corporation (HPTDC) was concluded after an unprecedented revenue-sharing bid of 47.1 per cent of the annual gross revenue, an official statement said.

     This is stated to be the highest-ever revenue-sharing bid in India for a transaction of this nature. The successful e-auction marks a significant milestone in the state government's efforts towards the optimal utilisation and commercial management of valuable public assets, the statement said.

     The arrangement is expected to generate substantial and sustained recurring revenue for the state exchequer, estimated at Rs 3 crore per month, with an annual escalation of 3 per cent, over the licence period of 35 years.

     The transaction is projected to generate aggregate revenue of approximately Rs 2,000 crore during the licence period, besides an upfront licence fee of Rs 24 crore and a committed minimum investment of Rs 50 crore in the hotel property.

     The property, which served as one of the residences of British Army commander Lord Kitchener during the British rule in India, was gutted in a fierce fire on April 5, 1993.

     Later, it was handed over to the East India Hotels (EIH) of the Oberoi Group to run it as a joint venture, 'Mashobra Resorts Limited'.

     The property was returned to the Himachal Pradesh government after a litigation process spanning nearly 25 years.

     Consequently, the state government secured complete ownership and control of the hotel land and property, the joint venture company and its associated assets and rights, along with cash accruals of approximately Rs 400 crore.

     Chief Minister Sukhvinder Singh Sukhu said that the resolution of the Wildflower Hall matter, after nearly 25 years of litigation, was a significant achievement for the state.

     The record-breaking revenue-sharing bid for the hotel ensures substantial long-term financial returns and demonstrates the government's resolve to protect public assets and strengthen the state's economy, Sukhu said.

(This story has not been edited by THE WEEK and is auto-generated from PTI)