Intercontinental Hotels Group (IHG) yesterday (12 July) placed hotels on the market with a net book value of £500m.

The move follows the company’s announcement on 27 May this year that it intended to dispose of property worth approximately £500m, in line with its strategy of expanding its management and franchise businesses and reducing asset ownership.

The hotels up for sale are mainly in North America and include the InterContinental Hotels in Miami and Chicago as well as 18 other properties under the InterContinental, Crowne Plaza and Holiday Inn brands.

The hotels are expected to raise £15m of EBIT and £39m of EBITDA in 2004.

IHG intends to retain management contracts on all the properties.

The company is also proceeding with sales in the previous tranche of hotels it put up for sale, worth £129m. So far, both the Holiday Inn, Gatwick and Holiday Inn, Adelaide, Australia, have been sold – with proceeds of more than £17m.

Richard North, chief executive, (pictured) said: “This announcement is a further step in the execution of our strategy of reducing the capital intensity of the business and enhancing return on capital. We will continue to grow our already large managed and franchise businesses by capitalising on the strength of our brands and proven franchise and hotel management skills.”

Since April 2003,when IHG demerged from Six Continents, the company has sold 28 hotels generating proceeds of more then £320m. With yesterday’s announcement, the value of hotels either sold or on the market is almost £1bn.

To date, IHG has purchased £138m of its own shares as part of its £250m buyback programme. An update on progress and further return of capital to shareholders will be announced with the company’s interim results on 9 September. Details: www.ichotelsgroup.com