Fairmont Hotels & Resorts is set to be merged with the Raffles hotel group following the takeover of Fairmont by Kingdom Hotels International and Colony Capital.

The deal, announced on 30 January, is worth US$5.5bn (£3bn, 4.5bn euro) and will see the creation of a global hotel group consisting of 120 properties in 24 countries when the Fairmont portfolio is combined with Raffles’, which is already owned by Colony Capital.

Kingdom Hotels is owned by a trust on behalf of HRH Prince Alwaleed bin Talal bin Abdulaziz Alsaud and his family and was a major shareholder in Fairmont prior to the deal, as well as having interests in Four Seasons Hotels and Resorts and Movenpick Hotels and Resorts.

HRH Prince Alwaleed said, "As one of Fairmont's current shareholders and strategic partners, Kingdom has long recognized the company's existing value and potential.

“Fairmont's success is clearly attributable to the dedication and professionalism of its management and employees. We look forward to partnering with Colony and working with both Fairmont and Raffles' management to take the combined companies to a new level of achievement."

Thomas J. Barrack, Jr., chair and chief executive officer of Colony said that the company would be looking to expand the enlarged group.

"Colony's mission is to make major investments with world class partners in irreplaceable assets managed by proven management teams,” he said. “Our partnership with HRH Prince Alwaleed and our investments in Fairmont and Raffles fulfill our mission.

"Fairmont and Raffles are an excellent strategic fit with rich histories, global brand recognition and complementary destinations. Joining the two luxury companies creates an ideal platform for continued international expansion."

Fairmont will remain an independent company with headquarters in Canada while Raffles will continue to be based in Singapore.