Bids for Shanghai Motel disappoint, Morgan Stanley may scuttle sale

SHANGHAI Bids for Shanghai Motel Management Co. have come in well below what was anticipated by majority owner Morgan Stanley, and the sale of one of China’s leading domestic hotel companies may be cancelled as a result.

Morgan Stanley, which owns about 59% of Shanghai Motel—operator of the 266-property Motel 168 brand and the fourth largest China-based hotel operator —had expected the asset to fetch about US$1 billion. Bids came in below that figure, The Wall Street Journal reports.

The sale process, which became public in February, has not yet been scrapped, and negotiations are continuing with bidders China Lodging Group Ltd. and Home Inns & Hotels Management Inc., the Journal reports.

Accor, with possible private equity backing, was also thought to be planning a bid for the company. Other major China players, including 7 Days Group Holdings Ltd. and Jin Jiang International Hotels Group, are among other companies expected to bid.