Mubadala Investment Company ready to buy remaining 50% in Viceroy Hotel Group

Mubadala Investment Company could announce as early as this week that it will buy out the 50 per cent of Viceroy Hotel Group it doesn’t already own, a person familiar with the discussions confirmed.

The hospitality group owns and operates more than dozen hotels across the world, including the Viceroy Palm Dubai, which opened at the end of March, the Yas Viceroy Abu Dhabi, which straddles the Formula One track, and L’Ermitage Beverly Hills, which it acquired in 2010.

The deal would see involve Mubadala, Abu Dhabi’s strategic development company, buying the 50 per cent stake owned by Malaysian businessman Jho Low and his affiliates, after he and his family lost a long battle in US federal court to prevent the seizing of assets by the US department of justice, which has alleged they were acquired with proceeds illegally siphoned from the 1Malaysia Development Bhd (1MBD) sovereign fund. 1MDB is the subject of investigations in multiple jurisdictions.

US prosecutors last week filed a civil forfeiture complaint in a federal court in Los Angeles seeking US$540m in assets allegedly purchased with funds stolen from 1MDB, including “rights to and interests in the Viceroy Hotel Group”, the Financial Times first reported on Sunday.

Mubadala officials declined to comment, and the terms of a possible deal have not been disclosed.

Mr Low acquired his stake in two transactions for a total of US$31 million more than five years ago, since when the group has continued to expand. The proceeds of any sale would be held by the US department of justice as part of its recovery process. Other assets the authorities have sought to seize include a New York penthouse, a share of EMI music publishing rights, and a corporate jet.

The Viceroy hotels are part of Mubadala’s international hospitality portfolio, which sits within the $122 billion fund’s “alternative investments and infrastructure” platform, accounting for about 30 per cent of its assets.