InterGlobe Enterprises managing director Rahul Bhatia (left) and Accor MD Asia Pacific Michael Issenberg in New Delhi on Tuesday. Picture by Ramakant Kushwaha

New Delhi, March 8: InterGlobe Enterprises and French hospitality major Accor have formalised a 60:40 joint venture to establish economy hotels in the country.

Last June, The Telegraph had reported that the two partners were planning a joint venture and were scouting for properties in India.

InterGlobe Hotels, a 60:40 joint venture between InterGlobe Enterprises and Accor Asia Pacific, will invest in developing 25 Ibis brand of economy hotels in India and South Asia over the next 10 to 12 years.

The venture envisages a total investment of over Rs 850 crore during this period. The plan is to invest Rs 165 crore in the first phase.

Eyeing the burgeoning mid-market hotel segment in India, the rooms will be priced between Rs 1,800 and Rs 2,200. According to Uttam Dave, president and CEO of InterGlobe Hotels, the brand will first be launched in Bangalore and Gurgaon (near Delhi).

It will then establish hotels in Mumbai, Chennai and Hyderabad. Sites are also being evaluated in Pune and Jaipur.

?We will enter Calcutta during our second phase,? Dave said.

Accor, which has 12 major brands operating across the globe, also plans to introduce its other brands ? Sofitel, Novotel and Mercure ? ?at the appropriate time?, said Michael Issenberg, managing director of Accor Asia Pacific.

The French hospitality chain had introduced the Sofitel brand a couple of years back in India, which proved to be a failure.

Responding on how does the hospitality major plan to make it a success this time around, he said, ?We did not invest last time. Now, we have chosen the right partner and the product. Rest will depend on our performance.?

Once the hotels are established in India, the chain will face direct competition from other chains like Sarovar Park Plaza, Choice Hotels, Best Western Group and Country Inn.