Saudi Arabia snaps up 49pc of Forte hotels

SAUDI Arabia has bought a 49pc stake in Sir Rocco Forte’s luxury hotels group as it ramps up its investments in the UK.

The deal by the Public Investment Fund (PIF) – which owns Newcastle United and which last week took a 10pc stake in Heathrow – values the owner of the Balmoral and Brown’s hotels at around £1.2bn.

Rocco Forte Hotels said the purchase of a ‘ significant’ minority holding by the Saudis would help improve its international presence.

PIF has also recently invested in luxury car maker Aston Martin and is estimated to have more than £550bn in assets. Forte and his sister Olga Polizzi will continue to hold a 51pc stake in the hotels group and remain executive chairman and deputy chairman respectively.

But Italian sovereign wealth fund CDP equity will sell its entire 23pc holdings as part of the agreement. It is understood Forte’s four other sisters will also leave the firm.

The Saudi investment comes amid a flurry of interest in UK assets from the Middle east.

A planned Abu Dhabi-backed takeover of The Daily Telegraph and The Spectator is under investigation.

Culture Secretary Lucy Frazer last week intervened in the proposed sale of the publications to RedBird IMI, the investment fund behind the deal, because of concerns over the potential impact on press freedom.

PIF, which is controlled by Saudi Arabia’s crown prince Mohammed bin Salman, has faced a backlash over the country’s human rights record.

But Forte, 78, said yesterday PIF was an ‘excellent partner’ for the group. He added: ‘We have established an extremely good relationship during the course of our negotiations.’