(Reuters) - InterContinental Hotels Group (IHG) (IHG.L) said it agreed to buy a 51 percent stake in luxury brand Regent Hotels and Resorts for $39 million (27.89 million pounds) in cash as part of its plan to go more upmarket to tap customers willing to pay top prices.
IHG, which operates the Crowne Plaza and Holiday Inn brands as well, said it would have the right to buy the remaining stake in a phased manner from 2026.
IHG has missed out on customers willing to pay more for greater exclusivity and intends to grow the Regent brand to over 40 hotels from six in global gateway city and resort locations over the long term.
A top IHG executive said in February the group was looking to buy one or two small luxury brands that do not have many physical hotels, as it did when it bought Kimpton Hotels for $430 million in 2014.
These brands would be more upscale than InterContinental hotels, allowing IHG to drive more revenue from the $60 billion global luxury hotels sector.
IHG also said following an extensive refurbishment pegged to start in early 2020, InterContinental Hong Kong would become a Regent Hotel in early 2021.
Regent was founded in 1970 as a luxury hotel brand by hotel industry veteran Robert Burns.
Reporting by Noor Zainab Hussain in Bengaluru; Editing by Gopakumar Warrier