Nicolas Berggruen, founder and president of Berggruen Holdings, in Mumbai on Tuesday. (Fotocorp)

Mumbai, Sept. 4: Berggruen Hotels Pvt Ltd, the hospitality arm of private equity company Berggruen Holdings Inc, will invest Rs 1,100 crore to set up 40 hotels across the country in the next 4-5 years.

The company has already acquired 14 sites and is looking for 15 more for its budget hotels under the brand Keys Hotels.

Berggruen Holdings, which recently raised over Rs 1,215 crore through the private equity route, said the fund would be utilised to expand operations in India over the next 2-3 years.

“Around Rs 450 crore of the fund will be invested in the hotel business. We require another Rs 600 crore, which will be financed through debt. Each of the hotels will have 100-170 rooms with all the modern amenities. The average cost of setting up a hotel will be about Rs 26 crore and we hope to start our first hotel by the end of the next year,” a senior official from the company told The Telegraph. “We are expecting an annual turnover of about Rs 350 crore in 2-3 years,” the official added.

Berggruen Holdings, which entered India last year, has committed an investment of Rs 80-450 crore in each of its six companies, which include Berggruen Hotels, Bergruenn Education Pvt Ltd, Gemini Equipment and Rentals Pvt Ltd, Berggruen Car Rentals Pvt Ltd and its real estate arm.

“India has been a priority market for Berggruen over the past one year and essential to our global strategy. Quality control and branding are our main emphasis, and we believe with our resources, we will be able to develop our business faster,” Nicolas Berggruen, founder and president of Berggruen Holdings Inc, said.

The company has started its education venture under the brand United Educational Institutes Global. The company will invest about Rs 50 crore in this education programme over the next three years.

United Educational Institutes Global, which offers courses in hospitality and tourism in its two institutes, will set up 28 more centres in the next eight months.

Berggruen Holdings has recently filed an application to raise $750 million for its new company, Liberty Acquisition Inc. The company is also the sponsor of Freedom Acquisition Holdings Inc, which is in its final stages to acquire GLG Partners, the largest hedge fund in Europe. The company said its investment in India is focussed to tap the huge potential in travel and hospitality.