Development of Growth & Expansion Strategy for Client X.

Development of Growth & Expansion Strategy for Client X.
Final Report – Executive Summary 9 June 2008

Agenda Approach Industry overview Sector analysis Strategic options
Selected strategy Next steps

Outline of the Project The project consisted of four phases, culminating in final deliverables and board presentation Phase 1 – Strategy Validation Phase 2 – Review of Strategic Options Phase 3 – Detailed analysis and strategy formulation Phase 4 – Final Deliverables and Board presentation Purpose Bring Client X management up to same level of understanding of global and regional hotel industry Discussion of: market s and segments that present opportunities for growth Agree on preliminary list of countries for further work Growth opportunities via M&A/JV/Alliance Analysis of 3 strategic options available to Client X Supporting Client X management in deciding on strategic option Detailed analysis and formulation of Client X’s strategy based on the review of strategic options Define strategic initiatives and finalise findings Output Minutes from workshop List of markets and segments selected as priority growth opportunities List of priority targets Agreed priorities for next phase Chosen strategy and strategic initiatives Agreed priority for next phase Minutes of workshop Chosen strategy for Client X Agreed final form of deliverable for Board Final Board presentation summarising data supporting strategic initiatives Actions Discussion by Client X Board to agree 3-5 options for further study in Phase 2 Agreement of options with Deloitte Discussion by Client X Board to agree option for further study in Phase 3 Agreement of option with Deloitte Confirmation of agreed strategy [Implementation]

Agenda Approach Industry overview Market overview Key considerations
Sector analysis Strategic options Selected strategy Next steps

Industry Overview: The Shareholder Value Model
The five ‘mega’ trends that will have the greatest impact in share holder value Brand Business model Emerging markets Mega-trends Technology Human assets

Industry Overview: Operating Models
Whilst all forms of ownership model are employed at the bottom of the market segment scale, the higher up the chain, the ownership model options narrow to owned and managed for reasons of brand integrity. However the level of sensitivity to variations in market conditions increases with both degree of ownership and market segment Rarely used Owned/leased Managed Degree of influence over asset/Ownership model Low High Degree of volatility1 based on market conditions Franchised Mid-Market Upper Upscale Budget Economy Upscale Luxury Level of market segment Note: 1. Volatility of profit to hotel branded chain, not individual hotel Source: Deloitte Analysis

Industry Overview: Organisational Structures
There are four organisational structure models. The choice of structure will depend on the stage of development and suitability for the hotel portfolio given strategic goals Regional Global / Functional Brand-centric Portfolio Characteristics Organized on a region/country basis—resources required to run business self-contained within geography Regions have profit-centre responsibility Some admin/infrastructure pushed down to local regions Organized on a functional basis-most key functions reporting up through a centralized home office structure Standards tightly managed throughout entire organization Often have matrixed reporting relationships to geographic and functional/brand leadership Organized by brand or grouping of brands—most key functional and geographic resources required to run business are self contained within brand grouping Standards within brand organization tightly managed Brand grouping has profit-centre responsibility Businesses are self contained and managed by holding company Portfolio companies usually have substantially different propositions Companies often report directly to the holding company CEO and often separate from other holding company properties Advantages Targeted focus on development and execution in the local marketplace Brand tightly managed and consistent throughout footprint Efficiencies drive lower costs through use of service centres, common infrastructure, strategic sourcing, etc. Each brand team has singular focus and profit responsibilities Minimal holding company attention required Limits risk of any brand dilution or confusion in marketplace Holding company has opportunity to learn from portfolio company Challenges Lack of brand standardization across geographies may dilute brand value Missed opportunities to reduce costs through consolidation of functions and activities Dual reporting relationships can be more difficult to manage Central control of key functions may slow decision-making Span of control at the executive level is typically higher than regional models Cross-brand sales or promotions are more difficult to coordinate or implement (reservations, reward programs, etc.) Cross-brand sales or promotions are more difficult (reservations, reward programs, etc.) Examples Source: Deloitte Analysis

Industry Overview: Demand & Supply – Global
Europe continues to dominate regarding total spend by international visitors; however, forecasts for Asia-Pacific focus countries and the Middle East and Africa show high growth by branded hotel room supply and international visitors International visitor demand vs. branded room supply, Growth in international visitors Many deals already completed in Middle East, which may suggest fewer opportunities Asia Pacific Middle East and Africa Potential in Location A due to increase in domestic travel Europe Latin America North America Total international visitor spend, size = USD 60bn Growth in branded rooms Note: Supply data is based on all global and regionally branded hotels, international visitor spend data is based on average trip spend excluding spend on transport to destination Source: Lodging Econometrics; World Travel and Tourism Council; Deloitte Analysis

Industry Overview: Demand & Supply – Int’l Overnight and Dom. Trips
Location A leads Asia-Pacific with the largest number of both domestic and international trips Domestic and International Trips by Country (2007) Million Trips Benchmark * Note: International demand is determined by international overnight trips for Domestic trips are for 2007 and are defined as travel of 50 miles or more, each way, which includes an overnight stay. *Due to rounding of decimal places, totals might not always correspond exactly to the sum. Source: Euromonitor; World Travel and Tourism Council; Deloitte Research & Analysis. Domestic International

Industry Overview: Demand & Supply – Domestic Trips
Leisure is the main driver for domestic travellers Domestic Business and Leisure Trips (2007) Million Trips Benchmark Data not available Note: International demand is determined by international overnight trips for Domestic trips are for 2007 and are defined as travel of 50 miles or more, each way, which includes an overnight stay. Source: Euromonitor; World Travel and Tourism Council; Deloitte Research & Analysis. Leisure Business

Industry Overview: Demand & Supply – Asia-Pacific
Growth in room supply and demand is expected in Asia-Pacific lead by Location A and India. These also had the largest number of trips among the Asia-Pacific focus countries for 2007 Total Demand Growth vs. Branded Room Supply Growth ( ) Percent Growth in domestic and international trips Growth in branded rooms 2007 Total number of Trips. Size = 250m Note: Demand growth is international and domestic travellers Source: Euromonitor; Mintel; Lodging Econometrics; World Travel and Tourism Council; Deloitte Research & Analysis.

Industry Overview: Demand & Supply – Penetration of Room Supply
Compared to the US and UK markets, there is potential within Asia-Pacific for increasing the current penetration of branded rooms Hotel Room Supply per Trip by Branded (2006) vs Total Rooms (2007) Rooms per Thousand Trips Benchmark US Branded UK Branded Branded Rooms Total Rooms Source: Euromonitor; Mintel; Lodging Econometrics; World Travel and Tourism Council; Deloitte Research & Analysis.

Industry Overview: Demand & Supply – UK Penetration in AP (1/2)
Location A, India and Indonesia currently need the most branded hotels to reach UK 2007 penetration figures Asia-Pacific Additional Hotel Rooms at UK penetration (2007)1 Million Rooms Branded Rooms Total Rooms Note: 1. Data used: International trips and branded rooms as at 2007; domestic trips estimated for 2007; total rooms as at 2006 Source: Euromonitor; Mintel; Lodging Econometrics; World Travel and Tourism Council; Deloitte Research & Analysis.

Industry Overview: Demand & Supply – UK Penetration in AP (2/2)
Looking forward to the year 2010, there is still a gap to reach UK 2010 penetration for branded rooms among several of the Asia-Pacific countries, lead by Location A, India and Location D Asia-Pacific Additional Hotel Rooms at UK penetration (2010)1 Million Rooms Branded Rooms Total Rooms Note: 1. Data used as follows: International trips and domestic trips estimated for 2010; branded rooms as at 2007; total rooms as at 2006 Source: Euromonitor; Mintel; Lodging Econometrics; World Travel and Tourism Council; Deloitte Research & Analysis.

Industry Overview: Demand & Supply – US Penetration in AP
There is capacity in Asia-Pacific lead by Location A for additional branded rooms in order to reach US 2007 penetration figures; and interestingly in fairly saturated markets such as Location D, there might still be space for branded hotels Asia-Pacific Additional Hotel Rooms at US penetration1 Million Rooms Branded Rooms Total Rooms Note: 1. Data used: International trips and branded rooms as at 2007; domestic trips estimated for 2007; total rooms as at 2006 Source: Euromonitor; Mintel; Lodging Econometrics; World Travel and Tourism Council; Deloitte Research & Analysis.

Industry Overview: Demand & Supply – Room Penetration
The majority of the Asia-Pacific focus countries have lower room supply penetration relative to Europe and North America. Global and regional brands account for a smaller proportion of room supply outside North America Room Supply Penetration (2007) Rooms per Thousand Inhabitants Note: Supply figure for India does not include lower budget. Total Location D supply figure includes ryokans (Location Dese Inns) Source: UN Estimates; National Statistics offices; Lodging Econometrics; Mintel; Deloitte Research & Analysis

Industry Overview: Demand & Supply – Branded Rooms by Chain Scale
The luxury segment accounts for c. 18% of total branded room capacity in Asia Pacific, which compares to c. 3% and 4.5% in North America and Europe, respectively Branded Supply by Chain Scale (2007) Share of Branded Rooms Regions Countries Note: Supply data is based on all global and regionally branded hotels only Source: Lodging Econometrics; Deloitte Research & Analysis

Industry Overview: Demand & Supply – Upper Upscale / Luxury Valuation
Hotel values have increased on average nearly 6% p.a. between , with cities in Location A, Malaysia, Indonesia and Singapore Upper Upscale / Luxury Valuation per Key (2006) USD Thousands 2006 vs CAGR $292k 5.6% Source: 2007 Asia Hotel Valuation Index; Deloitte Research & Analysis

Industry Overview: Global Hotel Operators – Overview
Global hotel operators have achieved success by offering a portfolio of brands tailored to specific customer segments, and creating operational efficiency by leveraging the size and scale of their distribution. Global Hotel Operators Indicative Competitor A Competitor B Competitor C Competitor D Competitor E Number of brands 7 10 15 12 Dominant current operating model Franchise Managed Owned/Leased Dominant geographic position Americas EMEA Dominant market segment Mid-market Budget Upscale Dominant historical growth strategy Initial growth through acquisitions Initial organic growth and acquisition of new segments Several brands through acquisitions Brand growth through acquisition Current growth strategy Managed and franchised Owned/Managed System-wide number of hotels 3,949 6,544 2,999 3,871 925 Pipeline as share of current supply 40% 19% 24% 41% 44% Dominant organisational model Regional Global/Functional Brand-centric Source: Deloitte Research and Analysis

Industry Overview: Global Hotel Operators – Financial Summary
Global hotel operators have achieved high return on capital invested by focussing on management contracts and real-estate transformation. Financial Results and Key Performance Indicators (2007) Indicative Competitor A Competitor B Competitor C Competitor E Competitor D Financial Results Total Revenue, $m 1,768 4,360 4,415 6,153 11,132 Market Cap, $m 4,470 3,864 12,777 10,469 15,837 EV / EBITDA 10.5x 5.7x 12.0x 11.4x 9.2x P / E 10.3x 18.8x 19.8x 11.9x Return on capital invested1, % 17 9 25 13 13.6 Key Performance Indicators2 RevPAR, $ 72 871 121 110 77 Occupancy, % 69.6 73.31 73.2 70.1 67.6 ADR, $ 103 1181 165 157 114 EBITDA, $m 437 892 1,385 1,164 1,905 EBITDA Margin, % 27.0 20.5 31.4 18.9 17.0 Note: 1 Due to information availability the figure is based upon the financial statements as at 2004 year end. Source: Deloitte Research & Analysis

Industry Overview: Regional Hotel Operators – Overview (1/2)
APAC brands have traditionally grown from an iconic flagship properties, and were first required to own a critical mass of their own hotels before expanding beyond APAC or into management contracts. Regional Hotel Operators Indicative AAAA BBBB CCCC DDDDD EEEE Number of brands 2 1 Dominant operating model Owned Dominant geographic position Location A Hong Kong Thailand India Dominant market segment Upper upscale Luxury Upper Upscale/Luxury Grown from iconic flagship property?  Dominant historical growth strategy Dominant current growth strategy Owned/Managed Managed Number of existing hotels 52 21 9 22 102 Pipeline as a share of current supply 100% 86% 9% 209% 88% Source: Deloitte Research & Analysis

Industry Overview: Regional Hotel Operators – Overview (2/2)
APAC brands have traditionally grown from an iconic flagship properties, and were first required to own a critical mass of their own hotels before expanding beyond APAC or into management contracts. Regional Hotel Operators (cont’d) Indicative AAA DDD BBB CCC EEE FFF Number of brands 8 2 1 Dominant operating model Managed Owned n/a1 Dominant geographic position Spain Location D APAC Location A Americas Indonesia Dominant market segment Mid-market/Upscale Upscale Luxury Budget Grown from iconic flagship property?   Dominant historical growth strategy Acquisitions Dominant current growth strategy Owned/Managed Number of existing hotels 328 63 232 80 18 Pipeline as a share of current supply 10% 160% 15% 152% Note: 1. No data/information could be obtained. Source: Deloitte Research & Analysis

Industry Overview: Regional Hotel Operators – Financial Summary
Asia Pacific chains have relatively high EV/EBITDA multiples and relatively low return on capital invested as a result of their asset heavy strategies. Financial Results and Key Performance Indicators (2007 unless otherwise stated) Indicative Financial Results Total Revenue, $m 1,002* 558 582 211* 430* 1,583 607 253* Market Cap, $m 8,341 1,635 2,095 696 1,873 3,700 1,946 3,800* EV / EBITDA 23.6x 12.8x 19.3x 17.9x 14.7x 7.8x 14.1 No data available P / E 22.4x 15.2x 5.1x 12.1x 38.7x 10.0x 20.4 58.2x Return on capital invested1, % 7* 8 4 8* 10.1* 11 16 11.6 Key Performance Indicators2 RevPAR, $ 102* 215 316 178* 34** 65 Occupancy, % 70 74 68 65* 71** 69.5 ADR, $ 146* 291 465 274* 48** 94 EBITDA, $m 350* 190 194 70* 111 410 173 80* EBITDA Margin, % 34.9* 34.1 33 33* 26 25.9 28 32* Note: 1 Based on continuing operations, excluding special items; 2 Company operated; 3 Relevant data is not available for JAL, Raffles, and Four Seasons. * Figure is based on 2006 figures due to information availability. ** Jin Jiang figures are based upon their 3-Star brand. This provides a best estimate given the width of their offerings Source: Company Data; Deloitte Research & Analysis

Agenda Approach Industry overview Market overview Key considerations
Sector analysis Strategic options Selected strategy Next steps

Key Considerations: Strategic Framework Initial Thoughts
We have identified a range of key considerations for Client X, which fall broadly into six categories Location Operational Excellence Portfolio Approaches Growth Patterns Play to your Strengths Talent Most significant driver of guest hotel choice Very few people choose a hotel brand and then choose a location Returns first, brand fit second Led to most development approaches being more tactical than strategic Organisations will have their desired location lists but market opportunity often overtakes Organic growth focused on locations where there is capacity within a segment Can create tension between Brand and Development Led to most brands having significant range of quality and locations Only strongest brands can adopt more strategic approach In the absence of property asset value increases, new management contracts are one of the key sources of increasing financial return Development pipeline now THE most important KPI for the major listed hotel operators A critical driver in delivering financial return No value in delivering low profitability on high occupancy and ADR Poor performance can destroy benefits of strong brand and location A key consideration for owners when selecting operators Number 1 core competency Vital that have strong core operations to support future growth – organic or acquisition All successful operators have either CEO or COO with many years operational experience often with same organisation and often starting from very low level Need stable central ‘system’ to support growth to enable new properties to be transitioned into the organisational smoothly Create pool of expertise that can be exported to new properties to ensure rapid adoption of standard processes and procedures Single segment approach With the exception of Four Seasons, all luxury single segment operators have built growth on the foundation of one or two iconic properties Luxury brands Almost all luxury brands have extended into resorts and residences (both owned and fractional) Resort developments are aimed at capturing the leisure market of their customers In the past 2 years the incorporation of a residential element has been required to make new builds financially viable Multi segment approach Many organisations have a luxury brand to deliver a ‘halo’ effect The core business is mid-market and the luxury brand delivers an aspiration for these guests Few organisations have mid-tier resort brands Home comfort With the exception of Four Seasons, all the major global and regional players have expanded close to home before significant global expansion This is reflected in the percentage of property portfolios in their domestic markets Second stage expansion is often in overseas regions with strong brand or cultural recognition Home advantage Easier to support new hotels from a logistical perspective as can leverage current suppliers, staff redeployment is easier and management can maintain closer oversight role. There are also obvious time zone advantages. Need to build critical scale of operations before adding additional strains of distant operations It is likely that there is stronger brand awareness in countries closer to home and also easier to build this brand awareness in weaker countries due to cultural similarities Many hospitality organisations have natural strengths Iconic properties Strong brand names Deep heritage Strong cultural links Corporate owners Access to capital Successful organisations have developed ways of harnessing these strengths Global and regional hospitality organisations invest significantly in their talent One of most significant assets particularly since property assets typically disposed At the heart of operational efficiency At the heart of delivering the branded experience Becomes more significant the higher the segment Large, high quality talent pool required to support growth Increasingly in short supply and predicted to get more so Recruitment and retention Its not just about operational training Staff engagement is just as important – feeling emotionally connected to the organisation Structured career development Source: Deloitte Research & Analysis 25 25

Agenda Approach Industry overview Sector analysis Region Country City
Strategic options Selected strategy Next steps

Region Analysis: Summary (1/2)
On a regional level, the ability for Client X to enter region in the short to medium term is high only in Asia-Pacific Ability for Client X to Enter Region in Short to Medium Term Indicative Requirements Europe North America Middle East & Africa Asia Pacific Ability to develop management skills, detailed operating procedures and central shared services Ability for Client X to oversee operations from Location X Ability to generate efficiencies from increased scale of operations Summary Source: Deloitte Research & Analysis

Region Analysis: Summary (2/2)
Demand and supply drivers are positive in both Asia-Pacific and the Middle East & Africa Summary of Key Drivers Indicative Key Drivers Europe North America Middle East & Africa Asia Pacific Demand drivers Supply drivers Historical performance Ability for Client X to enter region in short to medium term Investigate further? Source: Deloitte Research & Analysis

Region Analysis: Historical Performance – Global
Luxury and upper upscale have outperformed the other segments on average in each region ADR by Market ( ) USD 2007 vs CAGR Occupancy by Market ( ) Occupancy 2007 vs PP Change RevPAR by Market ( ) USD 2007 vs CAGR 67.3% $136 $92 8.3% 0.9% 9.1% Budget/Ec Mid-scale Upscale U. Upscale Luxury Americas Asia-Pacific EMEA Note: Growth rates based on local currency data Source: Smith Travel Research; Deloitte Research & Analysis

Country Analysis: Overview
The focus countries have been split into the top four, middle four and bottom three through the quantification of key success factors and subsequent ranking of these Quantification of key success factors Ranking of countries based on key success factors The key success factors for Client X to be able to enter these countries have been identified as: Economic drivers Demand drivers Supply drivers Ability for Client X to implement Historical performance An analysis was performed determining the quantum of each of these success factors The grouping has been determined by ranking the each country from 1 to 11 based on the relative performance of the key drivers, with 1 being the country with the best performance and 11 being the country with the worst performance We have primarily ranked the growth metrics in order to identify markets where there is high potential for future growth Absolute metrics are included to show relative size of metric

Country Analysis: Ranking by Degree of Opportunity for Client X
The mid-market and upscale opportunity for Client X appears to be highest in Location A, followed by Location B, Thailand, Location Y and the Philippines Ranking of Mid-market and Upscale Country Markets Indicative Opportunity Country Rank Location A 1 Location B 2 Thailand 3 Location Y 4 Philippines 5 Source: Deloitte Research & Analysis

Country Analysis: Country Focus – Location Summary (1/2)
Key forward-looking looking drivers have been assessed for each country… Summary of Key Forward-looking Drivers Indicative Country Economy Demand Drivers Location Z Dep. Supply Drivers GDP Growth (%) Int’l Trips (Million) Int’l Trips Growth (%) Domestic Trips (Million) Domestic Trips Growth (%) Dom. Tourism Spend ($bn) Dom. tourism spend growth (%) Location Z departures (Thousands) Penetration (Rooms per thousand trips) Penetration (Rooms per Million Inhabitants) Location Y 4.9% 6.4 3.0% 102 1% 19.6 5.5% n/a 0.1 1.2k Location D 2.3% 8.3 3.2% 341 216.5 4.6% 1,908 0.3 12.1k Location A 13.3% 74.7 6.4% 1,196 10% 105.4 16.8% 361 0.2 1.0k India 11.8% 5.0 6.7% 445 17% 22.4 10.4% 0.1k Singapore 4.3% 906 11% 1.2 7.1% 230 1.5 6.8k Thailand 5.9% 14.4 4.2% 85 8% 8.5 7.0% 825 5.6k Philippines 9% 3.1 5.8% 33 15% 3.6 485 0.3k Location B 13.8% 2.9 8.8% 17 16% 8.5% 299 1.5k Malaysia 6.2% 21.0 7.7% 39 6% 2.1 8.9% 111 0.4 5.8k Indonesia 12.3% 5.5 7.5% 226 7% 7.7 12.1% 100 Maldives 0.7 4.7% 0.01 0% 1.4 Ranked   Note: 1. Excludes business spend as data unavailable Source: See reference pack

Country Analysis: Country Focus – Location Summary (2/2)
…followed by key historic drivers such as valuations, key performance indicators and profitability, and Client X’s ability to implement Summary of Key Historic Drivers Indicative Country Ability to implement RevPAR Performance1 RevPAR Growth in local currencies Profitability Valuation Key Cities 2007 (USD) Key Cities Growth (%) Luxury (CAGR) Upscale / U. Upscale (CAGR) Mid-market (CAGR) Budget (CAGR) GOP Margin (%) Valuation per Key 2006 (USD ‘000s) Val. Growth per Key (CAGR) Location Y Very high 138 6% 3% -4% n/a 387 4% Location D High 119 8% -2% 2% 28% 831 5% Location A 118 0% 44 – 50% 389 India Low 207 32% 30% 56% Singapore Medium 141 22% 23% 21% 31% 42% 384 10% Thailand 80 1% 14% 46% 194 (0.4)% Philippines 79 15% 16% 11% 96 Location B 35% Malaysia 63 131 9% Indonesia 56 34% 12% 17% 26-26% 116 Maldives 4301 Ranked   Note: 1. Maldives figures for RevPAR and RevPAR growth are based upon Luxury and Upper Upscale hotels only; 2. GOP Margin is Income Before Fixed Charges based upon capital city figures with the following exceptions: Location A (Beijing, Hong Kong and Shanghai), India (Mumbai), Indonesia (Jakarta, Bali) Source: See reference pack

Country Analysis: Recap – Location Drivers Ranking (1/2)
Location A and Location Y appears to provide the best opportunities for Client X Ranking of Key Forward-looking Drivers Indicative Country Ability to implement Location Z Dep. Economy Demand Drivers Supply Drivers Location Z departures (Rank) GDP Growth (Rank) Int’l Trips (Million) Int’l Trips Growth (Rank) Domestic Trips (Million) Domestic Trips Growth (Rank) Dom. Tourism Spend ($bn) Dom. tourism spend growth (Rank) Penetration Rooms/Trip (Rank) Penetration Rooms/Pop’n (Rank) Weighting Critical Very High High Top 2 Location A 4 2 74.7 5 1,1961 105.4 1 3 Location Y Very high n/a 9 6.4 11 102 10 19.6 Middle 5 Location B 2.9 17 1.5 7 6 Philippines 3.1 33 3.6 Thailand 14.4 85 8.5 8 Indonesia 5.5 226 7.7 Malaysia 21 39 2.1 Bottom 4 India Low 445 22.4 Singapore Medium 8.3 1.2 12 Location D 341 216.5 Maldives 0.7 0.01 Note: Location A figures for phase 1 based on Greater Location A; 1. Domestic trips for Location A includes mainland Location A only Source: See reference pack

Country Analysis: Recap – Location Drivers Ranking (2/2)
Location A and Location Y appears to provide the best opportunities for Client X Ranking of Key Historic Drivers Indicative Country RevPAR Performance RevPAR Growth in local currencies Profitability Valuation Key Cities 2007 (USD) Key Cities Growth (Rank) Luxury (CAGR) U. Upscale/ Upscale (Rank) Mid-market (Rank) Budget (Rank) GOP Margin (Rank) Valuation per Key 2006 (USD ‘000s) Val. Growth per Key (Rank) Weighting Medium Top 2 Location A 118 9 n/a 8 5 2 389 3 Location Y 138 7 10 387 6 Middle 5 Location B 96 1 Philippines 79 4 Thailand 80 194 Indonesia 56 116 Malaysia 63 131 Bottom 4 India 207 Singapore 141 384 Location D 119 831 Maldives 4301 Source: See reference pack

Country Analysis: Drivers – Economic and Demographic
The selected countries boast encouraging demographic indicators and are forecast continued strong demand growth Summary of Key Forward-looking Economic and Demographic Drivers Indicative Country Economy Average Population Demographics and Spending Demand GDP per Capita (2007; USD) Total Population (Million) Total Income held by middle class1 (%) Middle Class Disposable Income Estimate (2007; USD Billion) PDI per Capita (2007; USD) Consumer Expenditure (2007; USD) Intl Receipts (USD Billion) Total Receipts Growth ,3 (CAGR) Location A2 2,450 1,291 35% 491.4 1,063 910 34.26 9.7% Philippines 1,582 77 34% 21.9 706 1,098 2.77 7.4% Location Y 19,680 49 42% 230.4 11,196 10,790 5.84 4.5% Thailand 3,700 63 42.2 1,814 1,980 10.51 5.5% Location B 810 84 36% 11.4 369 510 2.30 1.4% Note: 1. Percentage of income received by the 40% of households with middle bracket of income; 2. Location A figures for phase 2 focus on Mainland Location A Source: UNICEF; Price Waterhouse Coopers; The Economic Intelligence Unit; Deloitte Research & Analysis

Country Analysis: Drivers – Investment in Tourism
Chinese investment in travel and tourism is both significantly larger and forecast to grow more quickly than other focus countries Capital Investment ( )1 $ Billions Capital Investment (2007): Public vs Private Percent CAGR 125.8 1.7 15.3 3.8 1.5 Historic Forecast Location A 19.0% 10.1% Location Y 2.5% 6.4% Thailand 4.5% 6.9% Philippines (0.8)% 5.7% Location B 14.0% 6.5% Public Private Note: Private capital investment includes foreign investment Source: World Travel and Tourism Council; Deloitte Analysis

Country Analysis: Historical Performance – RevPAR
RevPAR performance varies, both in absolute level and growth CAGR ( ), by both geography and market segment RevPAR by Market ( ) USD 2007 vs CAGR Upscale / Upper Upscale Mid-/scale Luxury Budget / Economy Indonesia Location A Hong Kong India Location D Malaysia Philippines Singapore Location Y Thailand Location B $123 12.1% Note: Location D Budget/Economy, Malaysia Upscale / Upper Upscale, and Philippines Upscale / Upper Upscale are all Percentage Change; Growth rates based on local currency data Source: Smith Travel Research; Deloitte Research & Analysis

Country Analysis: Historical Performance – Occupancy
However occupancy shows a more varied picture with a higher proportion of categories showing negative change ( ) Occupancy by Market ( ) Occupancy 2007 vs Percentage Point Change Upscale / Upper Upscale Mid-/scale Luxury Budget / Economy Indonesia Location A Hong Kong India Location D Malaysia Philippines Singapore Location Y Thailand Location B 71.8% 1.9% Note: Location D Budget/Economy, Malaysia Upscale / Upper Upscale, and Philippines Upscale / Upper Upscale are all PP Change; Growth rates based on local currency data Source: Smith Travel Research; Deloitte Research & Analysis

Country Analysis: Drivers – Business and Tourism Country Rating
The overall business environment and travel and tourism prioritisation scores appear to be strongest in Location A, Location Y and Thailand Business Environment and Travel and Tourism Prioritization Score Card (2007) Rating (1 = low) Country Business Environment Rating1 Government prioritization of travel and tourism2 Effectiveness of marketing and branding2 Overall outlook Location A 5.6 5.2 4.7 Philippines 5.9 5.1 4.4 Location Y 7.1 Thailand 6.7 6.1 Location B 4.8 5.4 Good Poor Moderate Very Good Note: 1. The business environment rankings model examines ten separate criteria or categories, covering the political environment, the macroeconomic environment, market opportunities, policy towards free enterprise and competition, policy towards foreign investment, foreign trade and exchange controls, taxes, financing, the labour market and infrastructure. Government prioritization examines the level of government consideration given to travel and tourism in comparison to other industries. 2. The effectiveness of marketing and branding relates to that used to attract tourists into the country. In both cases, the scale is from 1 to 7; The Business Environment rating scale is from 1 to 10 Source: World Economic Forum: The Travel & Tourism Competitiveness Report 2008; Economic Intelligence Unit: Country Forecast February 2008; Deloitte Research & Analysis

Country Analysis: Rooms Supply, Pipeline and Penetration
Whilst Location B has the largest pipeline as a proportion of existing hotels, Location A has the largest absolute number of hotels in the pipeline Mid-Market/Upsc. Room Supply and Pipeline ( ) Percentage, Thousand Rooms Change in Mid-Market/Upscale Room Supply Penetration ( ) Rooms per Thousand International and Domestic Travellers 200,586 2,702 4,851 21,161 3,839 8,660 220 1,162 13,007 385 184 540 1,434 500 5,264 65,690 1,455 489 113,229 1,817 4,447 13,301 1,355 Current 2008 2009 2010+ Note: Supply data is based on all global and regionally branded hotels only Source: Lodging Econometrics; Deloitte Research & Analysis

Country Analysis: Key Performance Indicators
Location B, Thailand and Philippines have shown good RevPAR growth, predominantly driven by ADR growth, with some occupancy gains in Location B ADR by Country ( ) USD 2007 vs CAGR Occupancy by Country ( ) Occupancy 2007 vs PP Change RevPAR by Country ( ) USD 2007 vs CAGR 9.7% $94 (5.0)% 65% $61 5.6% Mid-Market Upscale Location A Philippines Location Y Thailand Note: Average indicators are based on weighted average and therefore skewed to towards the large Location A mid-market/upscale room numbers Growth rates based on local currency data; Location B is a combination of upscale and upper upscale KPIs Source: HotelBenchmark; Lodging Econometrics; Deloitte Research & Analysis Location B

Country Analysis: Profitability
Mid-Market/Upscale room profitability grew across all countries; the exception being Location Y Room Revenue & Profitability by Country ( ) Comparative RevPAR Index 2005, 2006 vs. GOP Margin 2005, 2006 2006 2005 Location Y Location B Average 2006: 77 Average 2005: 71 Thailand Philippines Location A Average 2005: 38.1% Average 2006: 40.4% Note: USD RevPAR 2005 and equivalent USD RevPAR 2006 assuming local currency growth Source: HotelBenchmark; Deloitte Analysis

Country Analysis: Illustrative Supply Opportunity
Location A Mid-Market/Upscale opportunity drastically exceeds that of the other countries; with Thailand and Location B showing a still sizeable opportunity Illustrative Supply Opportunity ( ) Thousand Mid-Market/Upscale Rooms 247.2k 240 245 250 Relative # hotels: ~1050 ~12 ~4 ~91 ~102 Note: Estimates are based on a number of assumptions and should be seen as illustrative and not regarded or relied upon as a forecast by Deloitte of expected future market behaviour. Actual outcome could be materially different to that shown Source: World Travel & Tourism Council; Lodging Econometrics; Hotel Benchmark; Deloitte Research & Analysis

Country Analysis: Illustrative Yields – New Build Hotel
Location B offers the highest yields with the least investment. The increases in hotel IBFC in Philippines and Thailand have been higher than the increases in construction costs, resulting in increasing yields Illustrative Mid-market Yield by Country ( ) Construction Costs per Room Thousand USD vs. Relative Yield 2006 Location Y 2005 Thailand Location B Philippines Location A Construction costs increasing faster than increases in hotel IBFC Construction costs increasing less than increases in hotel IBFC Annual Income before Fixed Charges per available room, expressed as a percentage of construction costs per Room Note: Construction costs exclude land costs; IBFC excludes ownership costs (rates, insurance, rent, interest, management fees, depreciation and taxes). Relative yield equals IBFC per key divided by construction costs per key Source: Hotel Benchmark; Davis Langdon; Deloitte Research & Analysis

Country Analysis: Location YHotel Market – Overview
The Location Yinbound market remains stable, while the outbound and domestic market are growing at high rates Inbound Outbound Domestic Hotels Drivers Except for the dent in 2003 which was caused by the outbreak of SARS, the Location Ytourism market is growing at a steady rate of 4.2% and is forecasted to grow at 4.5% in the near future. 76% of all visitors come from nearby Asian countries such as Location D (37%), Location A (14%) and Location C (5%) and also some from the U.S (10%). The strongest growth is of Location A (16%) and Location C (24%). However, receipts from tourists of 5.6 Trillion Won is growing at 3% which is lower than that of visitors, despite an increased length of stay, but because of a decrease in spend per night Location Y’s outbound tourism market is growing at a dynamic rate of 10.4%, while expenditure is growing at a even higher rate of 12% driven by the strong Location Z Won. However, departure and expenditure growth is forecasted to slow to 4.4%. Asian countries such as Location A, Location B, Location C and Location D remain the most popular countries to visit, representing more than 75% of all outbound trips. The domestic travel market has been growing at a rate of 13% but is forecasted to slow down to 1.4%. There was a dip when the Location Z Won strengthened, which was balanced by an increase in international travel. Domestic travel spend increased even when the number of travellers decreased indicating a higher spend per trip. Increase from 49 k won/trip in 2005 to 55.3 k won/trip in 2006 include the two biggest cities of Location Z – Location E and Location X, represent 50% of all trips. The Location Z hotel market has been stable growing 3.2% with inflation at 3%. Although the accommodation supply is dominated by above mid-market hotels, the budget hotel sector has been growing at 17.6% rate for the past five years. Luxury/upper upscale hotels with more than 200 rooms represent four percent of the entire lodging supply only. Despite Client X’ market leading position in Location X, there are several competitors with similar propositions. Several of them have recently undergone refurbishment programs. The evidence supports that the outlook for the domestic hotel market is positive as GDP continues to grow along with PDI Additionally a growing number of people are eating out which will support hotels’ F&B proposition. The market for international travellers is likely to be remain stable without a fluctuation in the exchange rate. Source: Deloitte Research & Analysis

Country Analysis: Summary – Key Decision-making Drivers
The summary of key decision-making drivers shows medium to high results for most countries Summary of Key Decision-making Drivers Indicative Key metrics Demand Drivers Location Z Arrivals Illustrative opportunity Historical Performance (KPIs and profitability) Investment in Tourism Business Environment Illustrative Yield Ability to implement Weighting Medium High Low Location A Philippines Location Y Thailand Location B Source: Deloitte Research & Analysis

Country Analysis: Summary – Ranking
Based on the 3 most important factors of illustrative opportunity, illustrative yield and ease to implement, Location A appears to be the first choice for mid-market growth Country Illustrative opportunity rating Illustrative yield rating Ease to implement Total (max. 30) Ranking Location A 10 7 8 25 1 Philippines 2 5 4 11 Location Y 15 Thailand 6 18 3 Location B 20 Key Criteria Description High Low Illustrative opportunity rating Based on the forecast increase in international and domestic demand to 2018, assuming constant occupancy and no increase in penetration of hotels 10 1 Illustrative yield rating Illustrative yield for each location, based on investment cost required and indicative profitability Ease to implement A subjective rating based on geographical proximity and Deloitte insight on local market conditions Overall Ranking Relative positioning of locations based on equal weighting of 3 key criteria Source: Deloitte Research & Analysis

Gateway Cities: Ranking by Degree of Opportunity for Client X
Shanghai is first when ranked by degree of opportunity, and followed by Beijing, Bangkok, Ho Chi Minh City and Singapore in the remaining top 5 positions Ranking of Luxury Gateway Cities Indicative Opportunity City Rank Shanghai 1 Beijing 2 Bangkok 3 Ho Chi Minh City 4 Singapore 5 Hong Kong 6 New York 7= Tokyo London 9= Paris Source: Deloitte Research & Analysis

Gateway Cities: Why Luxury
Client X has an opportunity to enter the luxury hotel market abroad based on both external and internal factors Category Section Detail Market Financials Overall profitability of luxury hotels is higher than other market sectors both in terms of absolute quantum vs benchmark sample and overall margin Luxury focused hotel chains have achieved historic growth in operating margin As an indicator of both analyst and investor confidence in the sector, share prices of luxury hotels have outperformed the index for hotels Luxury hotels tend to have higher yields than lower rated hotels KPIs Performance of luxury hotels KPIs has shown growth above other segments and (by definition) higher RevPAR levels Historically, luxury segment has outperformed upscale segment throughout the cycle Timing Supply growth Currently strong growth in luxury hotel supply in the AsiaPac market creates both opportunity and risk: An opportunity to get involved in current development or flag an independent or speculative development (e.g. Hong Kong) If the luxury market is not entered now, the increase in luxury product in the AsiaPac market will make it increasingly hard to find development opportunities or acquisition opportunities at a reasonable price. Additionally it will become increasingly hard to create a new brand based on competition versus already established brands Real Estate Valuations Growth in valuations per key of luxury hotels is based on increase in value of real estate and quality of location, brand and product Real estate of luxury hotels tends to be in prime locations and, if owned, tends to create a further opportunity for value creation. This is the unique differentiator of luxury versus other segments as premier locations command prices beyond the economic multiples Client X Brand Client X is a luxury brand, focusing on luxury product would be consistent with customer perception Potential to leverage both brand and experience into overseas growth, which is not possible for mid-market segment Experience Current hotel experience is in the luxury segment, which is different to other segments Vision Growth in luxury hotels is consistent with the vision of the senior management in Client X Scale Lower number of luxury hotels (compared to mid-market) required to achieve critical mass Source: Deloitte Research & Analysis

Gateway Cities: Demand (1/2)
Most gateway cities analysed are forecast continued strong growth in domestic and international tourism, which may drive future demand for hotels Summary of Key Forward-looking Drivers Indicative Country Country Economic Indicators City Demand Drivers Country Demand Drivers Illustrative Opportunity GDP Per Capita (USD) Real GDP Per Capita Growth (CAGR) Tourist Arrivals (Million) Int’l Trips (Million) Int’l Trips Growth (CAGR) Domestic Trips (Million) Domestic Trips Growth (CAGR) Average Trip Spend (USD) Avg. Trip Spend Growth (CAGR) Illustrative additional u. upscale / luxury hotels required by 2018 (# hotels) Bangkok 3,166 4.6% 10.4 14 4% 86 8% 847 5.6% 53 Beijing 2,012 8.9% 3.6 49 1,196 272 11.0% 123 Ho Chi Minh City 723 6.6% 2.3 2 13% 17 16% 893 (0.5)% 15 Hong Kong 27,499 4.1% 8.1 16 2% 6 454 4.2% 46 London 39,681 1.8% 15.6 30 129 (5)% 1,055 2.6% 58 New York 44,118 1.3% 6.2 51 5% 3,079 2,090 2.1% 62 Paris 36,706 1.6% 9.7 79 3% 165 234 44 Shanghai 4.3 115 Singapore 31,028 3.4% 9.5 8 1 10% 725 5.0% Tokyo 34,264 1.5 7 341 1% 1,155 20 Note: Growth rates based on local currencies Source: Deloitte Research & Analysis

Gateway Cities: Demand (2/2)
Historic RevPAR performance is encouraging for the gateway cities. Half the benchmark samples having experienced double-digit growth in , driven primarily by higher ADR Summary of Key Historic Drivers Indicative Country Upper Upscale / Luxury Benchmark Performance Upper Upscale / Luxury Benchmark Profitability Upper Upscale / Luxury Market Valuation Occupancy 2007 (%) Occupancy Change (p.p. Δ1 p.a.) ADR (USD) ADR Growth (CAGR) RevPAR (USD) RevPAR (CAGR) GOP Margin 2006 (%) GOP Margin Growth (p.p. Δ1) Valuation per Key 2006 (USD ‘000s) Val. Growth per Key (CAGR) Bangkok 70.5% (1.9)% $168 5.5% $118 2.8% 44.6% (0.1)% 195 1.7% Beijing 68.9% (0.7)%2 $141 5.0%2 $77 3.9%2 53.7% 229 7.0% Ho Chi Minh City 75.8% $116 38.8%2 $88 48.6%2 52.4% 3.4% n/a Hong Kong 83.0% 0.5% $227 10.8% $189 11.6% 40.2% 2.1% 624 4.5% London 79.5% $477 $379 11.2% 42.8% 4.2% 724 2.7% New York 83.1% 0.7% $397 13.7% $330 14.7% 37.4% 540 4.0% Paris 77.9% $533 5.8% $415 9.9% 33.1% 4.4% 664 1.6% Shanghai 68.6% (2.4)% $196 7.8% $135 47.1% (0.7) 315 7.5% Singapore 81.4% 1.8% $187 16.6% $152 19.3% 38.9% 2.5% 384 3.9% Tokyo 76.1% (2.2)%2 $232 6.3%2 $177 3.3%2 28.3% 0.9% 831 Note: Growth rates based on local currencies. 1 Average percentage-point change per annum. 2 Based on figures from Source: Deloitte Research & Analysis

Gateway Cities: Current and Pipeline Supply
The largest pipelines – both in terms of total rooms and as share of current supply – are found in the Chinese cities Current (2007) and Pipeline (c ) Upper Upscale / Luxury Supply by City Thousand Rooms Predominantly independents Pipeline: 8.7% 15.9% 12.8% 33.6% 5.5% 11.3% 2.8% 24.1% 2.1% 0.8% Current Supply Pipeline Source: Lodging Econometrics; Deloitte Research & Analysis

Gateway Cities: Key Performance Indicators
New York, Singapore and Ho Chi Minh City have experienced above-average growth in RevPAR Benchmark RevPAR by Market USD 2007 vs CAGR Average: $206 Average: 12% Note: Ho Chi Minh City growth rate for ; Beijing and Tokyo are Source: Hotel Benchmark; Deloitte Research & Analysis

Gateway Cities: Profitability
Luxury hotels in Beijing, Ho Chi Minh City increased their profitability from 2005 to 2006 with little addition to overall RevPAR. Bangkok and Shanghai did not experience profit growth Room Revenue & Profitability by City ( ) Comparative RevPAR Index 2005, 2006 vs. GOP Margin 2005, 2006 2006 2005 Average 2006: 210 Average 2005: 182 Low Cost Average 2005: 35.8% Average 2006: 39.0% Note: USD RevPAR 2005 and equivalent USD RevPAR 2006 assuming local currency growth Source: Hotel Benchmark; Deloitte Research & Analysis

Gateway Cities: Illustrative Supply Opportunity
The Chinese gateways appear to have the largest opportunity, driven by growth in demand Illustrative Supply Opportunity ( ) Thousand Upper Upscale / Luxury Rooms Relative # hotels: ~53 ~123 ~15 ~46 ~58 ~62 ~44 ~115 ~14 ~20 Note: Estimates are based on a number of assumptions and should be seen as illustrative and not regarded or relied upon as a forecast by Deloitte of expected future market behaviour. Actual outcome could be materially different to that shown Source: World Travel & Tourism Council; Lodging Econometrics; Hotel Benchmark; Deloitte Research & Analysis

Gateway Cities: Valuations
Hotels in Shanghai and Beijing are experiencing the greatest level of growth in property value of properties across the gateway cities Upper Upscale / Luxury Valuation per Key (2006) USD Thousands 2006 vs Local Currency CAGR 1 Average: $501k Average: 4.1% Note: USD Valuation 2005 and equivalent USD Valuation 2006 assuming local currency growth. Valuations based on Upper Up-Scale and Luxury only. Figures for Ho Chi Minh City unavailable. 1 CAGR shows low valuation due to 9/11. New York value taken from Source: HVS International; Deloitte Research & Analysis

Gateway Cities: Yields – Acquisition
Thailand and Chinese cities offer the highest yields at relatively low investment levels Illustrative Acquisition Upper Upscale / Luxury Yield by City ( ) Valuation Thousand USD vs. Benchmark Percentage Return per Annum 2006 2005 Tokyo Paris Hong Kong New York Relatively high return and low investment costs Singapore Location X Shanghai Bangkok Beijing Market valuations increasing faster than increases in hotel IBFC Market valuations increasing less than increases in hotel IBFC Annual Income before Fixed Charges per available room, expressed as a percentage of valuation per Room Note: Valuation figures not available for Ho Chi Minh City; IBFC excludes ownership costs (rates, insurance, rent, interest, management fees, depreciation and taxes). Relative yield equals IBFC per key divided by valuation per key Source: Hotel Benchmark; HVS International; Deloitte Research & Analysis

Gateway Cities: Yields – New Build
The three Chinese cities appear to offer the highest yield relative to construction costs. New build yields are higher than acquisition yields because of the lower costs Illustrative New Build Upper Upscale / Luxury Yield by City ( ) Construction Costs per Room Thousand USD vs. Relative Yield 2006 2005 Tokyo Location X Hong Kong Singapore Bangkok Beijing Shanghai Ho Chi Minh Construction costs increasing faster than increases in hotel IBFC Construction costs increasing less than increases in hotel IBFC Annual Income before Fixed Charges per available room, expressed as a percentage of construction costs per Room Note: Construction costs exclude land costs; IBFC excludes ownership costs (rates, insurance, rent, interest, management fees, depreciation and taxes). Relative yield equals IBFC per key divided by construction costs per key Source: Hotel Benchmark; Davis Langdon; Deloitte Research & Analysis

Gateway Cities: Summary – Key Decision-making Drivers
The summary of key decision-making drivers shows the majority of Asia-Pacific cities with medium to high results Summary of Key Decision-making Drivers Indicative Key Drivers Bangkok Beijing Ho Chi Minh City Hong Kong London New York Paris Shanghai Singapore Tokyo Demand drivers Location Z Arrivals Supply drivers Historical KPI performance Historical profitability Illustrative opportunity Illustrative yield unknown Ability to implement Source: Deloitte Research & Analysis

Gateway Cities: Summary – Ranking
The Chinese cities of Shanghai and Beijing, followed by the other five gateway cities in Asia-Pacific are all attractive options for luxury gateway market entry City Illustrative opportunity rating Illustrative yield rating Ease to implement Total (max. 30) Ranking Bangkok 6 9 8 23 3 Beijing 10 5 25 2 Ho Chi Minh City 91 7 18 4 Hong Kong 15 London 51 13 9= New York 14 7= Paris Shanghai 27 1 Singapore 17 Tokyo Key Criteria Description High Low Illustrative opportunity rating Based on the forecast increase in international demand to 2018, assuming constant occupancy and no increase in penetration of hotels 10 1 Illustrative yield rating Illustrative yield for each location, based on investment cost required and indicative profitability Ease to implement A subjective rating based on geographical proximity and Deloitte insight on local market conditions Overall Ranking Relative positioning of locations based on equal weighting of 3 key criteria Note: Rating 10 = high, 1 = low. 1. Proxy based on construction cost and local market knowledge Source: Deloitte Research & Analysis

Organic M&A Selected strategy Next steps

Strategic Options: Overview
At the highest level, Client X has to chose from 3 strategic options Current Value Realisation Status Quo Growth Strategy Sell Client X Real estate manager with new brand Fix Client X operations Defend against marketplace Source: Deloitte Research & Analysis

Strategic Options: Pros & Cons
Growth in luxury hotels in gateway cities carries high investment cost and significant risk factors. The mid-market option is potential very attractive under the franchise-in option Option 1: Mid-Market Countries Option 2: Luxury Gateway Cities Options 3: M&A Advantages Growth opportunities Existing development partners Gain platform in a master franchise Existing brand Economies of scale with current product Equity capability. Proven brands Speed Acquire expertise Current market discount Choice of segment Disadvantages No sector experience Potential to devalue Client X brand Investment requirement or need to acquire skills Current capital investment requirement Current operational performance Implementation risk Skills requirement. Credit markets Post Merger Integration risk Source: Deloitte Research & Analysis

Strategic Options: Organic Growth – Available Operating Models
Client X will need to follow an owned/leased operating model in both the mid-market and luxury sector in the short to medium term, until it is able to prove its ability to operate hotels profitably to owners Mid-market in focus countries Luxury in gateway cities Owned/Leased under Client X Brand or Client X Brand Family  Entering the mid-market with a Client X brand would be high risk due to the lack of an existing brand, and lack of experience and skills in the mid-market.  If Client X is willing to commit significant investment capital into owned/leased hotels, it will be able to enter gateway cities in the luxury sector Managed under Client X Brand or Client X Brand Family For the above reasons it would be highly risky to attempt to manage hotels under a Client X mid-market brand. Furthermore, returns are likely to be higher under a franchised in brand. Client X will only be able to secure management contracts in the luxury sector in gateway cities (other than potentially in Location X) once it has a proven track record. This will be in the medium to long term. Owned/Leased under franchised in brand Depending availability within each country, Client X has the potential to franchise in a global brand and capitalise on their brand, operational experience and procedures, sales and marketing platform, etc. Not applicable as luxury operators do not franchise out their brands. Managed under franchised in brand Not applicable in short to medium term until Client X can prove to owners that it can operate effectively. = Operating models available to Client X in the short to medium term Source: Deloitte Research & Analysis

Strategic Options: Key Components of a Platform for Profitable Growth
Client X will need to ensure it has the necessary platform to ensure profitable growth Global or regional sales and marketing team driving reservations Participation in global marketing strategies and programmes (e.g. promotions, yield management) Access to a globally recognised guest loyalty program (driving 30% - 50% of paid room nights) Strong cost effective distribution systems including website and GDS Standard operating procedures Improving hotel operating margins through procurement savings Providing shared services Providing access to training Brand standards Architecture and construction services Providing local development expertise Financial modelling Expertise in maximising real estate values Sales and marketing Operations Development Real estate Source: Deloitte Research & Analysis

Strategic Options: Focus Country International Arrivals
Based on number of international arrivals (line width) and historical growth (%), Location A and Location B appear to be the most attractive country options. However, this will depend on risk/reward aptitude Location A Location B Thailand Philippines Rep. of Location Z 30% 15% 16% 18% 22% 3% 51% 20% 4% 13% 11% 12% Suggested countries of focus 3% Historical growth & International Arrivals Approx. # Int’l Arrivals 3.0m 1.0m 0.5m Note: Reflects major population flows between focus countries only Source: Euromonitor; Deloitte Research & Analysis

Strategic Options: Approach – Luxury Gateway Cities
Viable approach but requires development of operational platform and recruitment of a development team. Consequently rollout rate will be slow at c hotels in 10 years Approach Begin development activity (sourcing opportunities) in top target cities simultaneously with a view to opening 1 property in year 3, second in year 4, third in year 5. Top target cities – Shanghai, Beijing, Bangkok, Ho Chi Minh City Based on current analysis Phase Two opportunities in Years 5-10 should focus on Hong Kong, Singapore and Tokyo Market analysis should be repeated within first five years to refine development activity Need experienced Development Team and this will take time and money to recruit with inherent risk Due to lack of brand awareness outside of Location Z the management contract model is not appropriate and so the ownership model is the most viable option Due to lack of brand awareness outside of Location Z it will be more difficult to acquire assets in these competitive cities The expenditure/revenue profile will show: Significant capital outlay in years 1 – 2 with no revenue Significant capital outlay in years 3 – 5 with limited revenue Significant capital outlay in years 5 – 8 with moderate revenue Lack of experienced management talent pool to manage new properties Lack of stable and efficient operating platform to deliver profitable growth Comment/Caveat Source: Deloitte Research & Analysis

Strategic Options: Approach – Mid-market Countries
Franchising in Location A offers the most attractive opportunity for growth both in terms of speed and building a reliable operational platform Approach Initial focus on Location A in years 1 – 5 with a target of 5 hotels Three potential approaches: - Major brand franchise and building assets - Acquire small portfolio of hotels ( 5 – 10 properties) - Acquire and convert single 4* properties Years 5 – 7 focus on Location B and Thailand through single asset development Need to begin Location B development activity in year 3 due to long lead time Begin Thailand development activity in year 4 Results in portfolio of 15 – 20 hotels within 10 years Lack of operational platform to support profitable growth which is particularly important for the mid-market Franchise option most attractive as will gain the most important elements of platform such as brand standards, standard operating procedures, training, central reservations and global marketing Remaining elements are the easiest to implement locally such as centralised IT systems Lack of experienced management pool to support growth Lack of experienced development team Opportunity to build on existing relationship with Suning Opportunity for rapid growth through acquisition of small portfolio and moderate growth through conversion of existing properties in Location A Precise location in Location A very important as not all secondary cities offer the best opportunities Review geographical options in year 4 before beginning phase 2 Comment/Caveat Source: Deloitte Research & Analysis

Strategic Options: Approach – M&A
Offers best option for growth with sector choice dependent on Client X’s growth ambitions Sector Dynamics Mid-market segment offers potentially larger more stable growth Luxury segment offers greater return in a growing market but greater risk in a declining market and less opportunity for growth in scale Cultural fit to Client X Geographic location of headquarters Capabilities acquired – talent, platform, property assets Synergies with current Client X brand and operations M&A provides quickest, least risky option for growth Returns will clearly be dependent on exact nature of acquisition target Choose segment based on vision Select targets based on fit (return, culture, footprint) Implement via tactical delivery of JV / majority stake / minority stake, as possible Implementation Considerations Comment/Caveat Approach Source: Deloitte Research & Analysis

Strategic Options: Summary
In summary, Client X should build on the strengths of Client X, obtain an experience CX team to drive forward and focus on expansion close to home Category Detail Build on strengths Valuable asset in Client X that needs realising to full potential Operational improvement and capital investment Increase returns and become showcase for growth strategy Obtain experienced CX team To realise potential in current portfolio To drive forward chosen growth strategy Start close to home Easier to manage, can leverage existing operations, brand awareness Most major multinational and regional players adopted this approach Trust the data The luxury segment in AsiaPac is out performing other regions and there is still plenty of future growth Shanghai, Beijing, Bangkok, HCMC, Singapore, Hong Kong offer best market opportunities Source: Deloitte Research & Analysis

Organic M&A Selected strategy Next steps

Organic: Gateway Cities Ranking Recap
The Chinese cities of Shanghai and Beijing, supported by SE Asia’s Bangkok and HCMC appear to be the best opportunities for luxury gateway market entry City Illustrative opportunity rating Illustrative yield rating Ease to implement Total (max. 30) Ranking Bangkok 6 9 8 23 3 Beijing 10 5 25 2 Ho Chi Minh City 91 7 18 4 Hong Kong 15 London 51 13 9= New York 14 7= Paris Shanghai 27 1 Singapore 17 Tokyo Key Criteria Description High Low Illustrative opportunity rating Based on the forecast increase in international demand to 2018, assuming constant occupancy and no increase in penetration of hotels 10 1 Illustrative yield rating Illustrative yield for each location, based on investment cost required and indicative profitability Ease to implement A subjective rating based on geographical proximity and Deloitte insight on local market conditions Overall Ranking Relative positioning of locations based on equal weighting of 3 key criteria Note: Rating 10 = high, 1 = low. 1. Proxy based on construction cost and local market knowledge Source: Deloitte Research & Analysis

Organic: Gateway Cities Ranking Opportunity Recap
The top 6 cities in the ranking represent attractive options for Client X which should be pursued to provide good regional coverage Ranking of Luxury Gateway Cities Indicative Opportunity City Rank Shanghai 1 Beijing 2 Bangkok 3 Ho Chi Minh City 4 Singapore 5 Hong Kong 6 New York 7= Tokyo London 9= Paris All top 6 cities represent attractive and interesting options for Client X to operate hotels in based on illustrative opportunity, yield and ability to implement, The long term goal must remain to have properties in each of the top 6 cities to provide strong regional coverage across key gateway cities. Ranking suggests an ideal order based on perfect market situation. However given pragmatic realities, it may not be possible to approach the cities in this order and Client X will need to opportunistic as to which options are achievable in what order Source: Deloitte Research & Analysis

Organic M&A Majority stake corporate targets Strategic partnership targets Iconic property targets Selected strategy Next steps

M&A: Overview of M&A Options
Deloitte have analysed 4 majority stake corporate targets, 8 minority acquisition targets and 4 iconic property targets Majority stake corporate targets Strategic partnership targets Iconic property acquisition Existing properties: Development opportunity: Aman deal with DLF now believed to be complete. Unlikely to be able to take majority stake Source: Deloitte Research & Analysis

M&A: Illustrative Time-line
It is vital that any approach to potential targets is fully thought out and a strategy formulated before the target is contacted Months Task 6 12 18 Evaluation of appropriateness of M&A strategy - Determine Client X's overall vision and strategy - Determine capacity to invest - Determine aim of M&A strategy (operations, brand, growth) - Evaluate the type of potential M&A targets Plan M&A - Appoint management team - Appoint advisors - Complete targeting and acquisitions search and analysis - Formulate an approach strategy - Agree a preliminary view on valuation and financial structuring Execution - Approach the target using top level contacts - Initial discussions and determining targets requirements - Obtaining and analysing targets management information - Financial due diligence and commercial due diligence - Negotiations & completion Post merger integration - Integrate management teams - Execute growth strategy Client X is still at the very early stages of an M&A process. No final decision on targets can be made at this stage, Approach only takes place after careful planning Source: Deloitte Research & Analysis

M&A: Key Success Factors of M&A Transactions
M&A transactions are difficult to execute. Key success factors differ from deal to deal. However, the following represent some of the key success factors for most deals. The timing of any acquisition significantly effects acquisition prices. Completing M&A deals in the current market is extremely challenging unless the acquirer is willing to pay a significant premium above quoted market values. In order to justify any M&A transaction you need to be able to show how the transaction will generate value for the combined new entity / group. For example, providing access to new markets or providing investment capital for expansion, The acquirer will need to be able to demonstrate the capacity to do the deal. This includes securing both the necessary debt and equity requirements. The acquirer needs to understand the needs of the vendor, i.e. “What’s in it for me” in order to be able to present a proposition they will be interested in discussing. For example, is the vendor looking to exit the business completely, are they looking to expand, etc. The acquirer and the vendor will need to be able to work together in order to successfully complete a transaction. This is even more important when the vendor has an ongoing interest in the company (e.g. Joint Venture) Timing Value-added Capacity to do deal Understanding the vendor Chemistry Source: Deloitte Research & Analysis

Majority Stake: Potential Deal Structures
In order to perform a majority acquisition Client X will require significant investment capital and be willing to pay in excess of current market prices Majority acquisition on own Majority acquisition with real estate partner Description Client X acquires more than 50% of the target company and therefore acquires brands, operations and real estate Examples: Competitor A, Competitor D, Competitor E and Competitor C Client X acquires the target together with a partner. Subsequent to the transaction the real estate is spun off into a propco. Examples – Prince Alwaleed & Four Seasons Requirements Significant investment capital Required to pay 20% - 30% more than current market prices A partner interested in acquiring the real-estate and wanting to partner with Client X. In the short to medium term the partner would need to be Samsung related (until Client X proves themselves). Pros Complete control of transaction Acquisition of proven brands and operations Fastest method of expansion Significantly reduces acquisition costs for Client X as it acquires operations only Provides base for future growth if partner continues to invest in real-estate of new developments Partner can have real-estate or development expertise Cons If target is listed Client X will be required to make an offer for 100% of the equity of the target as a result of most stock exchange regulations Will need to pay a significant premium over current market prices in order to secure majority control. No real estate appreciation for Client X Source: Deloitte Research & Analysis

Majority Stake: Screening ‘Long List’ of Potential Targets
4 Luxury/Upper Upscale companies were identified as potential majority stake acquisitions Luxury / Upper Upscale Upscale / Mid Market ‘Long List’ of targets 36 38 Minimum Investment Criteria Targets meeting minimum investment criteria 8 9 Value Creation Criteria ‘Short list’ of targets Client X has indicated they do not wish to pursue a mid-market M&A strategy 4 5 Note: (1) enterprise values is c.$1bn or less; (2) Based on target’s brand equity, operational experience and geographical presence in focus countries/cities Source: Deloitte Research & Analysis

Majority Stake: Alternative Strategies for Engaging Identified Targets
Client X is restricted to a minority or JV investment unless it is able to increase the funds available for investment. 1 Possibility of a majority acquisition is unknown until approach is made. Will require the payment of a significant premium. Will need to observe stock exchange rules (offer to acquire 100% of stock) Unlikely to be a possibility as recently acquired by DLF who have significant expansion plans. Unlikely to be a possibility unless Client X has access to over $1bn for investment. The Hunt family and Maritz Wolff each own 50% and therefore both would need to be bought out. Majority investment Possibility of JV acquisition is unknown but likely to be challenging given that Banyan is a listed company with a large number of investors. Client X would need to prove value-add. This is unlikely to be a possibility as DLF have significant funds available for investment (don’t need investment partner) and already have a presence in Asia Pacific. This is a possibility, however, Client X would still need to have access to c.$0.5bn+. Client X would need to demonstrate the value it would add to an M&A deal (e.g. expansion in Asia). Joint Venture Banyan is a listed investment therefore minority investment can be acquired through purchasing on the open market or through off-market purchases from significant investors. Price premium can be limited by careful planning of open market acquisitions. Stock exchange rules require disclosure of interests in excess of thresholds (e.g. 5%) This is unlikely to be a possibility as DLF have significant funds available for investment (don’t need investment partner) and already have a presence in Asia Pacific. Client X would need to demonstrate the value it could add to the deal. Possibility of a minority investment is unknown until an approach is made. Client X would need to demonstrate the value it would add to an M&A deal (e.g. expansion in Asia). Minority investment Note: Morgan’s has not been included in the above analysis and Client X indicated they do not consider it to be an attractive target. 1. DLF believed to have completed deal to acquire controlling interest in Aman Resorts group Source: Deloitte Research & Analysis

Majority Stake: Acquisition Target (1/4)
HQ: Haryana, India Aman resorts Portfolio Overview 100% Resorts Operating Model: Hotels: 18 existing Rooms: 806 Number of Employees: N/A Ownership and Share Price Significant shareholders: DLF limited, Adrian Zecha Enterprise value band: c.$400m (last transaction value) Key executives: Adrian Zecha Share Price: N/A Total # of Hotels # of New Hotels Owned Number of New Hotels Total Number of Hotels Key Performance Indicators 07 06 Occupancy Rate ADR $778 RevPAR Return on Capital Employed Return on Equity EBITDA Margin Geographical Distribution % of # of hotels Brand Distribution % of # of rooms Other1 Thailand Philippines Cambodia Bora Bora Bhutan Aman India Profitability – Revenue, EBITDA (US$ million) 09E 08E 07 06 05 04 03 02 Revenue EBITDA Sri Lanka Indonesia Note: 1. France (1), Morocco(1), U.S.(1), Turkey (1) Source: Deloitte Research & Analysis

HQ: Singapore, Singapore Portfolio Overview 82% Resorts Operating Model: Hotels: 23 existing & 49 pipeline Rooms: 2,330 Number of Employees: 7,068 Ownership and Share Price Significant shareholders: Ho Kwon Ping (36.5%), Chiang See Ngoh Claire (36.5%) Enterprise value band: c.1$bn (current) - c.1.6$bn (June 2007) Key executives: Ho Kwon Ping, Ariel P Vera, Chiang See Ngoh Claire Share Price: Total # of Hotels # of New Hotels 1997 Asian Financial Crisis Managed Owned 3.0 2.5 Share price (S$) 2.0 1.5 1.0 Number of New Hotels Total Number of Hotels 0.5 Sep 06 Jan 07 May 07 Sep 07 Jan 08 Key Performance Indicators 07 06 Occupancy Rate 67% 63% ADR $ 235 $ 215 RevPAR $ 157 $ 135 Return on Capital Employed 10% 15% Return on Equity 18.8% 9.9% EBITDA Margin 29.0% 33.2% Geographical Distribution % of # of hotels Brand Distribution % of # of rooms Indonesia Angsana APAC other1 Location A Banyan Tree Other2 Maldives Profitability – Revenue, EBITDA (US$ million) 09E 08E 07 06 05 04 03 02 Revenue 396.8 309.5 280.2 211.1 112.6 159.4 EBITDA 124.0 93.0 81.3 70.1 20.9 Laguna Thailand Note: 1. India(1), Sri Lanka(1), Laos(1); 2. Seychelles(1), Morocco(1), Australia(1), Bahrain(1); 3. Data on shaded area not available as Banyan Tree went public in only June 2006 Source: Deloitte Research & Analysis, CIMB Report, Yahoo Finance

HQ: New York, NY Portfolio Overview 36% Resorts Operating Model: Hotels: 12 existing & 6 pipeline Rooms: 6,800 Number of Employees: 1,9501 Ownership and Share Price Significant shareholders: Morgan Stanley & Co (17.66%), Fidelity Management & Research (14.78%), Blackrock Advisors (6.38%) Enterprise value band: $1.2bn (current) - $1.4bn (June 2007) Key executives: David Hamamoto (Chairman), Fred J.Kleisner (CEO), Richard Szymanski (CFO) Share Price Total # of Hotels # of New Hotels JV Owned 30 25 Went public in February 2006 20 Share price (US$) 15 Number of New Hotels Total Number of Hotels 10 Jan 04 Jan 05 Jan 06 Jan 07 Jan 08 Key Performance Indicators 07 06 Occupancy Rate 80.1% 77% ADR $ 396 $ 319 RevPAR $ 317 $ 246 Return on Capital Employed 3% 7% Return on Equity -9% -10% EBITDA Margin 35.1% 30.5% Geographical Distribution % of # of hotels Brand Distribution % of # of rooms Scottsdale Hard Rock San Fran. Shore Club L.A. Sanderson Las Vegas St.Martins London Clift Hudson Delano Miami Profitability – Revenue, EBITDA (US$ million) 09E 08E 07 06 05 04 03 02 Revenue 389.0 345.6 323.0 278.6 260.4 EBITDA 149.3 111.7 113.2 85.1 79.5 Royalton Morgans New York Mondrian Note: 1. As of December 31, 2006 – does not include employees of joint venture restaurants Source: Deloitte Research & Analysis, Yahoo Finance, Oppenheimer

HQ: Dallas, Texas, United States Portfolio Overview 55% Resorts Operating Model: Hotels: 17 existing & 6 pipeline Rooms: 1,939 Number of Employees: c.5,000 Ownership and Share Price Significant shareholders: Hunt family (50%) and Maritz, Wolff & Company (50%) Enterprise value band: c.1$bn+ Key executives: John Scott (President & CEO), Susan Aldrige (SVP & General Counsel), Bob Boulogne(COO), Jim Brackensick (SVP – Purchasing), George Fong (SVP – Architecture & Design), Ernest Glidden (SVP – Finanace), Alex Alt (Diretor- Development & Strategy), Sheri Line (HR Director) Share Price: N/A Total # of Hotels # of New Hotels Owned Managed Number of New Hotels Total Number of Hotels Key Performance Indicators 07 06 Occupancy Rate ADR RevPAR Return on Capital Employed Return on Equity EBITDA Margin Geographical Distribution % of # of hotels Brand Distribution % of # of rooms Tokyo King Pacific San Ysidro Middle East Cordevalle Jumby Bay Anasazi Caribbean Peachtree Las Ventanas Caneel Bay Seiyo Ginza Latin America Al Khozoma Carlyle Al Faisaliah Profitability – Revenue, EBITDA (US$ million) 09E 08E 07 06 05 04 03 02 Revenue 350 EBITDA North America Rosewood Note: 1. Five hotels including Rosewood Corniche, Rosewood Mansion on Turtle Creek, Rosewood Crescent Hotel, Rosewood Little Dix Bay, Rosewood Mayakoba Source: Deloitte Research & Analysis

Strategic Partnership: Investment Plan
A strategic partnership investment plan would allow Client X to acquire an immediate stake in the target with a view of acquiring a majority stake at a later stage Deal description Client X enters into a strategic partnership with a target whereby value is created for both partners: Client X acquires a minority share (10% - 20%) in the target company and negotiates a position on the board. Client X transfers management of its existing hotels to the target company in exchange for the target investing repositioning capex. Client X co-invests in real estate of new hotel developments that bear the brand of the target. Client X helps source the opportunities using Samsungs muscle/contacts/network/own customer base of it's employees Client X will be well positioned to acquire a majority stake if the opportunity presents itself in future years. Pros Cons Opportunity to acquire an immediate stake in target (with minimum premium) and positions Client X well to acquire a majority stake in the future. Only have minority interest in target therefore have limited control over its direction and strategy. Value generated by improved performance at existing Client X hotels as a result of access to targets platform and operational excellence. Risk of losing control of Client X Brand. Opportunity remains to expand Client X brand (e.g. co-brand with target where it makes sense. Potential negative impact on shareholders view of the value of the company (i.e. no longer runs its own hotels). Client X ideally positioned invest in prime hotel real estate projects.

Strategic Partnership: Screening ‘Long List’ of Potential Targets
Eight Luxury/Upper Upscale companies were identified as potential minority stake acquisitions ‘Long List’ of targets Within Client X investment capacity(1) Targets within Client X investment capacity 20 hotels Brand ‘fit’ with Client X(2) ‘Short list’ of targets 9 hotels Note: (1) required investment to obtain a 10% interest must be less than $300m; (2) Client X fits within target brands and M&A transaction likely to generate value Source: Deloitte Research & Analysis

Strategic Partnership: Potential Targets –
HQ: Singapore Portfolio Overview 82% Resorts Operating Model: Hotels: 23 existing & 49 pipeline Rooms: 2,330 Number of Employees: 7,068 Ownership and Share Price Significant shareholders: Ho Kwon Ping (36.5%), Chiang See Ngoh Claire (36.5%) Enterprise value band: c.1$bn (current) - c.1.6$bn (June 2007) Key executives: Ho Kwon Ping, Ariel P Vera, Chiang See Ngoh Claire Share Price: Total # of Hotels # of New Hotels 1997 Asian Financial Crisis Managed Owned 3.0 2.5 Share price (S$) 2.0 1.5 1.0 Number of New Hotels Total Number of Hotels 0.5 Sep 06 Jan 07 May 07 Sep 07 Jan 08 Key Performance Indicators 07 06 Occupancy Rate 67% 63% ADR $235 $215 RevPAR $157 $135 Return on Capital Employed 10% 15% Return on Equity 18.8% 9.9% EBITDA Margin 29.0% 33.2% Geographical Distribution % of # of hotels Brand Distribution % of # of rooms Indonesia Angsana APAC other1 Location A Banyan Tree Other2 Maldives Profitability – Revenue, EBITDA (US$ million) 09E 08E 07 06 05 04 03 02 Revenue 396.8 309.5 280.2 211.1 112.6 159.4 EBITDA 124.0 93.0 81.3 70.1 20.9 Laguna Thailand Note: 1. India(1), Sri Lanka(1), Laos(1); 2. Seychelles(1), Morocco(1), Australia(1), Bahrain(1); 3. Data on shaded area not available as Banyan Tree went public in only June 2006 Source: Deloitte Research & Analysis, CIMB Report, Yahoo Finance

HQ: Hong Kong, Location A Portfolio Overview 10% Resorts Operating Model: Hotels: 10 existing & 4 pipeline Rooms: 5,580 Number of Employees: 4,044 Ownership and Share Price1 Significant shareholders: Enterprise value band: $2.5bn (current) Key executives: Ka Shiu Lo (Chairman of the Board, managing director) Yiu Wah So (Hotel executive vice president) Share Price Total # of Hotels # of New Hotels Owned 40 30 20 Share price (HK$) 10 4 Number of New Hotels Total Number of Hotels Jan 04 Jan 05 Jan 06 Jan 07 Jan 08 Key Performance Indicators 07 06 Occupancy Rate 80% 79% ADR $189.8 $169.8 RevPAR $149.4 $133.8 Return on Capital Employed1 14.5% 1.92% Return on Equity1 15.5% 2.0% EBITDA Margin1 39.7% 37.6% Geographical Distribution % of # of hotels Brand Distribution % of # of rooms London Eaton Thailand Delta Pacific Americas Profitability – Revenue, EBITDA (US$ million)1 09E 08E 07 06 052 042 03 02 Revenue 536.1 485.6 452.8 363.5 312.2 329.5 EBITDA 212.6 182.7 1,750 499.0 70.1 94.8 Langham Hong Kong Note: 1. information of Great Eagles Holdings Limited, which owns Langham Hotels International Limited;2. The EBITDA is high due to the large increase in fair value changes on investment properties Source: Deloitte Research & Analysis

HQ: Hong Kong, Location A Portfolio Overview 0% Resorts Operating Model: Hotels: 21 existing & 18pipeline Rooms: 10,000 Number of Employees: 10,000 Ownership and Share Price Significant shareholders: Jardine Strategic and its subsidiaries (73.58%) Enterprise value band: $2.3bn (current) Key executives: Edouard Ettedgui (Group CEO, Director), John Witt (Finance Director) Share Price Total # of Hotels # of New Hotels Leased JV Owned 3 Managed Went public in February 2006 2 Share price (US$) 1 Number of New Hotels Total Number of Hotels 03 04 05 06 07 08 Key Performance Indicators2 07 06 Occupancy Rate 72.1% 72.9% ADR $ 381 $ 331 RevPAR $ 286 $245 Return on Capital Employed 10.4% 13.8% Return on Equity 10.1% 8.0% EBITDA Margin 19% 14% Geographical Distribution % of # of hotels Brand Distribution % of # of rooms Europe Americas Mandarin Oriental Profitability – Revenue, EBITDA (US$ million) 09E 08E 07 06 05 04 03 02 Revenue 1,007 850.3 815.4 667.3 541.2 547.5 EBITDA 190.2 116.4 124.0 99.0 68.8 78.0 Asia1 Note: 1. Bangkok, Chiang Mai, Hong Kong (3), Jakarta, Kuala Lumpur, Macau, Manila, Singapore, Tokyo; 2. Data available only for those with significant ownership Source: Deloitte Research & Analysis, Reuters

HQ: Bangkok, Thailand 61% Resorts Operating Model: Hotels: 18 existing & 12 pipeline Rooms: 2,654 Number of Employees: c.18,000 Ownership and Share Price Significant shareholders: Minor Corporation Plc. (17%), Minor Holdings (Thai)Ltd. (17.28%), William E. Heinecke (7.10%) Enterprise value band: $1.9bn (current) Key executives: Michael Sagild Share Price2: Total # of Hotels1 # of New Hotels Went public in 1988 JV 20 Owned 18 Share price (THB$) 16 14 12 Number of New Hotels Total Number of Hotels Jan 08 Feb 08 Mar 08 Apr 08 May 08 Key Performance Indicators 07 06 Occupancy Rate 64% 66% ADR US$ 307 US$ 215 RevPAR US$ 196 US$ 142 Return on Capital Employed3 9.2% 7.1% Return on Equity3 18% EBITDA Margin3 21% Geographical Distribution % of # of hotels Brand Distribution % of # of rooms Naladhu Location B Bodu Hura Serendib Sri Lanka Club Dolphin Sigiriya Harbour View Maldives Anantara Four Seasons Profitability – Revenue4, EBITDA (US$ million) 09E 08E 07 06 05 04 03 02 Revenue 216 201 193 123 EBITDA 47 42 40 26 Thailand Competitor C Note: 1. Data unavailable for one JV hotel; 2. Available data only; 3. Data of entire group; 4. Data of hotel operations only Source: Deloitte Research & Analysis, The Stock Exchange of Thailand

HQ: New York, NY Portfolio Overview 36% Resorts Operating Model: Hotels: 12 existing & 6 pipeline Rooms: 6,800 Number of Employees: 1,9501 Ownership and Share Price Significant shareholders: Morgan Stanley & Co (17.66%), Fidelity Management & Research (14.78%), Blackrock Advisors (6.38%) Enterprise value band: $1.2bn (current) - $1.4bn (June 2007) Key executives: David Hamamoto (Chairman), Fred J.Kleisner (CEO), Richard Szymanski (CFO) Share Price Total # of Hotels # of New Hotels JV Owned 30 25 Went public in February 2006 20 Share price (US$) 15 Number of New Hotels Total Number of Hotels 10 Jan 04 Jan 05 Jan 06 Jan 07 Jan 08 Key Performance Indicators 07 06 Occupancy Rate 80.1% 77% ADR $ 396 $ 319 RevPAR $ 317 $ 246 Return on Capital Employed 3% 7% Return on Equity -9% -10% EBITDA Margin 35.1% 30.5% Geographical Distribution % of # of hotels Brand Distribution % of # of rooms Scottsdale Hard Rock San Fran. Shore Club L.A. Sanderson Las Vegas St.Martins London Clift Hudson Delano Miami Profitability – Revenue, EBITDA (US$ million) 09E 08E 07 06 05 04 03 02 Revenue 389.0 345.6 323.0 278.6 260.4 EBITDA 149.3 111.7 113.2 85.1 79.5 Royalton Morgans New York Mondrian Note: 1. As of December 31, 2006 – does not include employees of joint venture restaurants Source: Deloitte Research & Analysis, Yahoo Finance, Oppenheimer

HQ: Hong Kong, Location A Portfolio Overview 11% Resorts Operating Model: Hotels: 9 existing & 1 pipeline Rooms: 2,874 Number of Employees: Ownership and Share Price1 Significant shareholders: Bermuda Trust Company Limited (55%), The Mikado Prviate Trust (50%), Bermuda Trust (Cayman) Limited (30.6%), Acorn Holdings Corporation (29.6%) Enterprise value band: $2.5bn (current) Key executives: The Hon.Sir Michael Kadoorie (Chairman), Clement King Man Kwok (CEO) Share Price Total # of Hotels # of New Hotels Owned 20 15 10 Share price (HK$) 5 Number of New Hotels Total Number of Hotels 3 Jan 04 Jan 05 Jan 06 Jan 07 Jan 08 Key Performance Indicators 07 06 Occupancy Rate 68% 72% ADR $465 $369 RevPAR $316 $266 Return on Capital Employed 5.5% 6.0% Return on Equity 16.2% 12.0% EBITDA Margin 33% 34.2% Geographical Distribution % of # of hotels Brand Distribution % of # of rooms Quail Lodge Manila Tokyo Bangkok Location A Peninsula Profitability – Revenue, EBITDA (US$ million) 09E 08E 07 06 05 04 03 02 Revenue 582 479 421 400 323 332 EBITDA 192.1 163.8 139.8 127.4 93.3 95.8 US Source: Deloitte Research & Analysis, Company website

HQ: Dallas, Texas, United States Portfolio Overview 55% Resorts Operating Model: Hotels: 17 existing & 6 pipeline Rooms: 1,939 Number of Employees: c.5,000 Ownership and Share Price Significant shareholders: Hunt family (50%) and Maritz, Wolff & Company (50%) Enterprise value band: c.1$bn+ Key executives: John Scott (President & CEO), Susan Aldrige (SVP & General Counsel), Bob Boulogne(COO), Jim Brackensick (SVP – Purchasing), George Fong (SVP – Architecture & Design), Ernest Glidden (SVP – Finanace), Alex Alt (Diretor- Development & Strategy), Sheri Line (HR Director) Share Price: N/A Total # of Hotels # of New Hotels Owned Managed Number of New Hotels Total Number of Hotels Key Performance Indicators 07 06 Occupancy Rate ADR RevPAR Return on Capital Employed Return on Equity EBITDA Margin Geographical Distribution % of # of hotels Brand Distribution % of # of rooms Tokyo King Pacific San Ysidro Middle East Cordevalle Jumby Bay Anasazi Caribbean Peachtree Las Ventanas Caneel Bay Seiyo Ginza Latin America Al Khozoma Carlyle Al Faisaliah Profitability – Revenue, EBITDA (US$ million) 09E 08E 07 06 05 04 03 02 Revenue 350 EBITDA North America Rosewood Note: 1. Five hotels including Rosewood Corniche, Rosewood Mansion on Turtle Creek, Rosewood Crescent Hotel, Rosewood Little Dix Bay, Rosewood Mayakoba Source: Deloitte Research & Analysis

HQ: Hong Kong Portfolio Overview 14% Resorts Operating Model: Hotels:52 Rooms: 20,299 Number of Employees: 29,6001 Ownership and Share Price Significant shareholders: Kerry Group Limited3 (49.6%), JPMorgan Chase & Co.(5.0%) Enterprise value band: US$9.9bn Key executives: Khoon Ean Kuok (Chairman), Khoon Loong Kuok (President and CEO), Man Shing Lui (Deputy Chairman) Share Price Total # of Hotels # of New Hotels Managed Owned 25 20 Share price (HK$) 15 10 Number of New Hotels Total Number of Hotels Jan 04 Jan 05 Jan 06 Jan 07 Jan 08 Key Performance Indicators 07 06 Occupancy Rate 71% 73% ADR $152 $135 RevPAR $105 $96 Return on Capital Employed 14.0% 11.6% Return on Equity 9.5% 7.1% EBITDA Margin 39.2% 34.9% Geographical Distribution % of # of hotels Brand Distribution2 % of # of rooms Other2 Other Asia Thailand Traders Philippines Singapore Malaysia Location A (inc Hong Kong) Shangri-La Profitability – Revenue, EBITDA (US$ million) 09E 08E 07 06 05 04 03 02 Revenue 1,219 1,003 842 726 540 EBITDA 478 350 265 Note: 1. Headcount of all the group’s managed hotels and resorts; 2. Includes brands of managed hotels; 3. Owned by the Kuok family Source: Deloitte Research & Analysis, Company website, Yahoo Finance

Strategic Partnership: Potential Targets
HQ: Singapore Portfolio Overview 15% Resorts Operating Model: Hotels: 28 Rooms: 9,646 Number of Employees: 1,1051 Ownership and Share Price Significant shareholders: DBS Nominees Pte Ltd(16.05%), C Y Wee & Co Pte Ltd (13.25%), Wee Investments Pte Ltd (10.12%), Tye Hua Nominees Pte Ltd (9.34%), Citibank Nominees Singapore Pte Ltd (7.14%) Enterprise value band: US$3bn + Acquired Pan Pacific in 2007 for US$4.3 million Key executives: Wee Cho Yaw (Chairman), Gwee Lian Kheng (Group President and CEO) Total # of Hotels2 # of New Hotels Owned Managed Number of New Hotels Total Number of Hotels Key Performance Indicators 07 06 Occupancy Rate 75% ADR RevPAR Return on Capital Employed Return on Equity 19% 11% EBITDA Margin Geographical Distribution % of # of hotels Brand Distribution % of # of rooms Novotel Australia Crowne Plaza North America4 Sofitel Sheraton Parkroyal Asia3 Profitability – Revenue, EBITDA (US$ million) 09E 08E 07 06 05 04 03 02 Revenue 474 381 304 273 267 EBITDA Pan pacific Note: 1. In Singapore only; 2. As of Dece0ber 31, 2007; 3. Singapore (4), Location D(3), Malaysia(3), Location B(3), Thailand(1), Indonesia(1), Philippines(1), Bangladesh(1), Myanmar(1), Location B(1), Location A(1); 4. Canada(3), US(2) Source: Deloitte Research & Analysis, company website

Iconic M&A: Iconic Property Approach
Whilst acquiring an iconic property is a proven approach, it is not currently viable for Client X. However Client X could acquire a “Tier 2” iconic property Proven approach Not viable for Client X Could acquire “Tier 2” The strategy of buying a truly iconic property and then building a portfolio using the name of this property as the brand has been popular in the recent past Dorchester Collection Langham Le Crillon Plaza Athenee Raffles Waldorf = Astoria However, this would appear not to be a viable approach for Client X: All the truly iconic properties around the globe are either part of corporate groups or owned by individuals embarking on a similar strategy If one was available it is likely that the valuation would consume most of the $1bn investment capital leaving very little to fund the growth programme The high valuation is likely to reduce the yield to below 4% Competition for assets is with sovereign wealth funds who are investing for “national good” not just financial returns There are a number of ‘2nd tier’ iconic properties in Asia that with the right investment and approach could form part of the organic development strategy: Accelerates the increase in the portfolio Could bring platform and management experience if independently owned Could bring guests as often property more well known than operator

Iconic M&A: Gateway Cities Ranking Opportunity Recap
The top 6 cities in the ranking represent attractive options for Client X which should be pursued to provide good regional coverage Ranking of Luxury Gateway Cities Indicative Opportunity City Rank from phase 2 Market entry strategy based on insight from local THL experts and identified opportunities Potential timeline Shanghai 1 New build Year 3 Beijing 2 Year 4 Bangkok 3 Acquire existing hotel or new build Year 2 Ho Chi Minh City 4 Year 5 Singapore 5 Acquire existing hotel or convert Year 1 Hong Kong 6 Year 6 New York 7= Acquire existing hotel Medium to long term Tokyo London 9= Paris Source: Deloitte Research & Analysis

Iconic M&A: Acquisition Target (1/4)
HQ: Hong Kong, Location A1 Overview Market Position: Luxury Location: Bangkok, Thailand Rooms: 210 Built: 1988 Remodeled in: 2007 Dining: 7 restaurants & 1 bar Conference/Banquets: 17 meeting rooms & 2 ballrooms Spa: Yes Other: Squash and tennis courts Ownership Significant shareholders: HKR International, Payson Cha. Management General Manager Duncan Palmer who previously managed two hotels for The Savoy Group. Prior to that he spent twelve years in senior management roles with the Mandarin Oriental Hotel Group Key Performance Indicators ’07 occupancy rate: 71% Awards Ranked 8th in Asia for Overseas Leisure Hotels and 10th for Overseas Business Hotels in the Conde Nast 2003 Readers’ Travel Awards Best business hotel in Thailand by Business Asia Thailand Note: 1. Headquarters of HKR International Source: Deloitte Research & Analysis, company website

Overview Market Position: Luxury Location: Singapore Managed by: Sino Group of Hotels Rooms: 400 Opened: January, 2001 Built in: 1928 Dining: 4 restaurants & 1 bar Conference/Banquets: 7 meeting rooms & 3 ballrooms Spa: Yes Other: The straits room and roof garden Ownership Significant shareholders: Ng family Redevelopment Acquired by Sino Land Company Ltd from Urban Redevelopment Authority with US$72.9 million (S$100million) in 1997. Renovation to convert the historic building into a hotel and development of 1 Fullerton commercial complex cost US$291.5 million (S$400million) and opened in 2001. Awards 2008, 2007: Conde Nast Traveller Gold List Hotel July 2007: Leading Hotels in the World in Travel & Leisure’s World’s Best Awards October 2006: Ranked #1 in Asia by Conde Nast Traveller Source: Deloitte Research & Analysis, company website

Iconic M&A: Acquisition Target (3/4), Conversion Opportunity
HQ: Singapore Overview Market Position: A fully member-oriented club Location: Singapore Managed by: Owners Rooms: None Built: 1926 Remodeled in: 2002 Dining: 4 restaurants & 2 bars Conference/Banquets: 8 function rooms & 1 ballroom Spa: Yes Other: Tennis courts, member’s lounge, card rooms Ownership Owned by the National Parks Board of Singapore Leased by: The Legends Fort Canning Park Pte.Ltd., which is owned by: Ms.Goh Min Yen (Executive Chairman – daughter of Mr. Goh Eng Wah), Mr. Oh Chee Eng (CEO), Mr.Goh Eng Wah (founder of Eng Wah Organisation) The family is also behind listed cinema operator Eng Wah Organisation Management Mr. Oh Chee Eng (CEO), Mr.Herbert M. Hofer (GM) Acquired The National Parks Board granted the new owners with a 30-year lease on the 11,148 sq m site for SGD85 million in 2002 Affiliation Members attain access to The Legends Golf & Country Resort in South Carolina, US Source: Deloitte Research & Analysis, company website

HQ: Hong Kong, Location A1 Overview Market Position: Luxury Location: Sentosa, Singapore Rooms: 215 Opened: 1991 as The Beaufort Hotel Renamed in: 2002 as Sentosa Resorts & Spa Dining: Two restaurants & two bars Conference/Banquets: 24 meeting rooms & 3 ballrooms Spa: Yes Other: Golf club, Seven Eden Wellnes Centre Ownership Significant shareholders: HKR International, Payson Cha Key Performance Indicators ’07 Occupancy rate: 68% Relaunch Previously known as the Beaufort Singapore, it was renamed as The Sentosa Resort & Spa after a US$10 million upgrading of the property. This includes Singapore’s first destination spa, Spa Botanica Sentosa’s branding strategy is to align itself closely to the destination in which it is located and to earn itself an independent identify Note: 1. Headquarters of HKR International Source: Deloitte Research & Analysis, company website

Selected strategy Foundation stage Growth stage Financial implications Next steps

Selected Strategy: Key Decision Making Questions
There are 4 key questions that Client X needs to answer that will help determine which strategy to chose Question Organic (inc. potential property acquisition) Strategic partnership 1. Is your vision to be a hotel and brand operator? If yes, then need to follow an organic growth strategy Possible in long term if able to purchase a majority stake 2. Are you willing to recruit an external CX team inc: Provide them with autonomy? Provide them with a commensurate package? Provide suitable incentives, inc. equity? Incorporate and HQ the company outside Location Y? If yes, then possible to follow an organic growth strategy If no, Client X will have to pursue strategic partnership as the risk of failure in organic will be very high given current management experience 3. What is your risk appetite? Requires appetite to be high given uncertainty of organic development Require lower risk as investment in established company 4. What is your investment capability? Investment capability will determine the approach – either pure organic or accelerated growth via property acquisitions and therefore the level of returns Level of investment will determine the scale of company that can be invested in and the amount of control within that company Additionally will determine how much further investment is available for sliver equity in real estate development, and therefore how attractive to a strategic partner Client X will be Source: Deloitte Analysis

Selected Strategy: Strategic Options Overview
Deloitte are suggesting an initial 2 dual track strategy for c. 3 months to determine which route is going to fit with Client X objectives and provide the best option longer term Strategic Partnership Initial exploration of potential for strategic partnership with luxury hotel company Estimated timeline of c. 3 months to know whether or not this option will achieve Client X goals Strategic Partnership Dual track strategy Client X can initially pursue a dual track strategy, with key benefits: Ensure that Client X moves on Outlay of costs during the initial phase is minimal Creates maximum impact in short timeframe Organic Development (inc. potential property acquisitions) Organic development including potential for acquisition of c. 2 properties in key gateway cities Initial activity will be low cost and create positive growth platform even if strategic partnership is deemed achievable after initial 3 month period Organic Development Source: Deloitte Analysis

Selected Strategy: Roadmap – Proposed Approach
Whichever track is followed Client X will need to follow a 3 stage approach. 1. Foundation Stage - Initial fix of core product; 2. Initial growth stage - lay foundations for growth either via organic approach (inc. possible acquisition of tier 2 iconic properties) or strategic partnership; 3. Secondary growth stage which may include full corporate M&A 1. Foundation Stage Based on pragmatic/ opportunistic implementation, activities may overlap between stages Recruit CX team Fix Division X Brand research Corporate governance activity New luxury hotel product by Greenfield/Brownfield development, property conversion, lower grade hotel upgrade May also include reflagging of luxury property/ies via acquisition (overlap with corporate) Acquisition of well known “iconic” hotel Icons fall into 2 categories: Tier 1 – Globally recognised brand Tier 2 – Locally recognised product based on architecture, location, service, history Investment in minority stake within corporate chain Includes management of existing hotels by partner and sliver investment in future real estate pipeline Acquisition of a luxury corporate chain Organic Iconic Strategic Partner Corporate 2. Initial growth stage 3. Secondary growth stage Potential to convert strategic partnership into full corporate M&A via majority acquisition in longer term Source: Deloitte Research & Analysis

Selected Strategy: Key Growth Drivers and Success Factors
The key growth drivers for each strategy is the addition of hotels into Client X portfolio and the level of investment available. Success is determined by experience within either management or advisors Option Key Growth Driver(s) Key Success Factors Examples Organic Development Growth is going to be driven by number of new properties added to the existing portfolio, either by Greenfield/ Brownfield development, conversion or acquisition and upgrading of existing properties Size of growth will depend on choice of location (and achievable RevPAR) along with size of hotel(s) and extra revenue generating facilities Choice of location may be based on factors such as forecast demand and supply, current penetration levels and ease of entry into market Strong and experienced CDO Availability of locations Efficient development process from origination through to completion Acceleration of ramping period to mature operation Mandarin Oriental Shangri-La Iconic Acquisition Acquisition of assets to add into Client X portfolio Value add proposition for acquisition Strong M&A negotiation skills Ability to execute – funds and credit Speed of completion and integration with Client X Dorchester Collection Langham Corporate Acquisition - Majority Availability of targets Type and make up of corporate acquisition Timing and approach Price Availability of equity and credit Post merger integration activity (e.g. 100 day plan) Four Seasons Strategic Partnership Size of investment Availability of funds for investment in real estate Impact of brand and operations on Division X Rationale for acquisition and WIIFM1 Rationale could include investment in rollout properties, which would require further capex investment Effective contract negotiations for matters relating to operations and leverage of expertise to improve Client X performance Board seat(s) Rosewood Aman Note: 1. What’s in it for me

Selected Strategy: Available Funds
The funds available to Client X have a significant impact on the strategies that can be pursued in the short term, although subject to timing of funds long term all 3 strategies are possible Funds available Implications Our understanding of Client X fund availability: Year 1-2: $300million (Equity and Debt) Year 3-5: $700million (Equity and Debt) Year 5+: Unknown Greater funds may be made available subject to need, but will require access to external funding sources Available funding in years 1 and 2 is not enough to purchase either a corporate or an iconic property (tier 1 or 2), suggesting that initially only 2 potential options are available: Organic growth Strategic partnership Accessing external funds would require Client X to meet investment criteria of external sources. This would limit the ability of Client X to invest in iconic properties that may be the basis of a rollout, given the low IRR that would be achieved based on the premium price required Subject to timing of funding in year 3-5 it may be possible to follow all 3 strategic options Note: Renovation funds for Division X are separate that noted above

Selected Strategy: Comparison of Strategic Options
Whilst a higher risk option than strategic partnership, organic growth would enable Client X to remain a hotel operator Organic (inc. potential property acquisition) Strategic Partnerships Implementation Risk – People High Low Implementation Risk – Investment $1bn [Yr 1-7] Medium/low Returns IRR 22% [15x] TBD Recruit CEO and Team Yes ? Will require hotel real estate asset management expertise Autonomous hotel business Required to attract top team and enable value creation Subject to specifics of strategic partnership OpCo/PropCo structure Maximum flexibility for debt financing and asset value over time (leverage asset business) Driven by tax benefits Client X full potential Yes [10/10] R/E = Yes, Ops = No [Yr 1-5] Minimises investment requirement Brand awareness Key criteria for selection of strategic partner Growth of hotel company will increase power and value of brand Platform for growth in operations Possibly over longer term subject to JV/majority investment Brand ownership Own a share of brand, but not direct control End State in yr 5/10 10/10 OpCo and PropCo OpCo Minority Yr1-5 Majority Yr 5 ++ PropCo yr 5 yr10 Source: Deloitte Research & Analysis

Foundation Stage: Key Recommendations – Summary
There are 5 foundation steps that Client X needs to undertake prior to any growth strategy Category Detail Recruit experienced CEO Experienced both in operational efficiency and growth through development and M&A Will recruit CX team particularly COO, CDO and CMO Create autonomous hotel business Separate legal, accounting and reporting entity CEO reports to Mr Sung Create Op Co/Prop Co structure within hotel business Real estate requires deep skills to maximise value and ‘challenge’ operations Operational focus gravitating towards brand as key driver of shareholder value Enables leverage of PropCo Realise the potential of Division X Improve GOP through operational efficiencies Complete refurbishment to global 5 star standards Conduct brand awareness research in AsiaPac Need to ascertain true strength of Client X brand in the identified key markets Will directly impact nature of growth strategy Source: Deloitte Research & Analysis

Foundation Stage: Corporate Governance – Ownership Structure
As a subsidiary Client X Company Ltd. can demand the right level of support, continuity and visibility with adequate independence and autonomy for the growth and expansion strategy with responsibility for new CX team Business Unit Subsidiary Spin-Off Joint Venture Description Client X reports to Client X board Client X reports to Client X CEO Client X is a separate legal entity but reports to a Client X Corp entity Client X reports to Client X board and JV Partner Pros Simple structure No change to current operations and management of group Smooth transition Gives hotel development visibility Simplifies hierarchy by having Client X report only into the CEO Dotted line allows for sharing of information, co-ordination and consistency of Client X brand name Gives flexibility in choosing operating model (OpCo/PropCo etc.) Gives flexibility in expanding to different locations Indicates the importance and scale of the strategy Provides clear governance: source of funding, responsibility and ownership of strategy Gives clear indication of the importance and scale of the strategy Might have positive market buy-in by linking of iconic M&A activity to JV Partner Provides dual sources of resources such as funding / budgeting Cons Insufficient visibility and support for building a luxury hotel portfolio Need for more structure in case of multi-market and multi-hotel expansion Need to manage relationship with Client X board although they are not officially linked to Client X Need to ensure that visibility with CEO provides the necessary support an relays the importance of the growth strategy regardless of option: organic or M&A Restructuring needed to shift current hotel portfolio into new structure Need for co-ordination when using Client X name across the business units Divides governance between JV Partner and Client X Harder to maintain Client X brand consistency with separation of portfolio Client X Current Divisions CEO Samsung CMO CDO CFO COO Client X Hotel Co. Ltd. Client X Corp.. Client X Current Divisions Samsung CMO CDO COO CEO CFO Client X Hotel Co. Ltd. JV Partner Note: Current Client X Divisions: Duty Free, Fitness / Direct Sales, New Business, Management Administration, Strategy, Internal Audit Source: Hotels Magazine; Deloitte Research & Analysis

Foundation Stage: Corporate Governance – Operating Model
An OpCo/PropCo operating model can give Client X Company Ltd. the structure needed for long term and sustainable growth and expansion but local tax considerations are paramount External Sale and Leaseback (S&LB) OpCo / PropCo OpCo / PropCo Joint Venture Description Involves Client X. disposing of commercial property for its fair market value and immediately taking a long lease back from the purchaser. Client X. would retain operational control for the duration of the lease Client X. would transfer commercial property to a new subsidiary (PropCo) for its fair market value. PropCo services the debt using rental received from the operating company (OpCo). Client X Co. would retain operational control and, via the PropCo, property equity upside Client X. would transfer commercial property to a new subsidiary (PropCo) for its fair market value. PropCo sells equity to a JV partner. Third parties can contribute cash, skills etc., while Client X. Would retain operational control and, via the PropCo, property equity upside Pros Crystallise value – leveraging any differential between corporate and property valuations Cash available to de-gear/distribute/re-invest etc. Lease payments should be less than debt interest Retain operational control of the hotel portfolio Reduce WACC and financial risk Retain ownership of property and capital appreciation upside Retain operational control Reduce WACC Independent exits for OpCo and PropCo Retain interest in property; capture residual value Benefit from third party expertise, cash etc. Reduce WACC and any development risk Independent exits for OpCo and PropCo JV Cons Loss of freehold interest in favour of lease Loss of capital appreciation upside Increased operational gearing Possible arbitrage - property/corporate valuations Only a portion of property assets’ investment value is realised (dependent on gearing) Highly geared structure with banking covenants over both OpCo and PropCo Full banking and property due diligence required Only a portion of property assets investment value is realised dependent on gearing Highly geared structure with banking covenants over both OpCo and PropCo JV Shareholder agreement to regulate JV relationship Impact - Growth Options Not viable for a long term growth strategy regardless of option: organic, iconic M&A, corporate M&A, hybrid Can be used for iconic M&A, corporate M&A and hybrid growth options where third party skill and experience is already assumed to be gained in the acquiring of these hotels and can also be leveraged for organic hotels Can be used for organic growth option in order to gain that third party investment and expertise while mitigating risk Property Hotel Client X Co. Ltd. Investor Rent EBITDA Assets Source: Deloitte Research & Analysis

Foundation Stage: Corporate Governance – Organisational Structure
Whichever strategic option is chosen, the high-level organisation structure remains the same, but the roles within the structure vary as will the consequent job description CEO Executive Management Development (CDO) Finance (CFO) Sales & Marketing (CMO) Operations (COO) Project Development & Construction Product Development Finance Investment & Strategic Planning Sales Communications & PR Technology Organisational Effectiveness Option A: Organic Construction of hotels including external space Refurbishments and renovations Take strategic direction from Brand Take budget direction from Finance Responsible for real estate management Coordinate budgeting process Define purchasing strategy and policies in order to obtain synergies and cost efficiency Investment approval CAPEX, ROI Determine brand architecture, brand plan Build relationships with and develop insight into customers (end users / intermediaries) Analyse competitor information Manage promotions, pricing and distribution Allow for seamless processes throughout hotel portfolio through use of technology Supply chain / inventory management Run hotels within brand expectations Option B: Iconic M&A Maintain facilities and standard of brand Hotel refurbishments / renovations Drive development capability for M&A Investment approval CAPEX Coordinate budgeting process, ROI Assess value of brand and other intangibles Determine how to use iconic brand (reverse branding) Leverage existing relationships with customers (end users / intermediaries) Maintain level of operations Run hotel within brand expectations Leverage iconic operations with Client X Option C: Corporate M&A Development economies of scale Direct existing development capability Use and improve on operations from M&A and incorporate throughout Client X Option D: Hybrid Maintain consistency in constructions, refurbishments and renovations throughout Client X portfolio Support development capability Drive development capability for JVs, M&A and managed hotels Purchasing economies of scale Leverage and integrate existing relationships with customers (end users / intermediaries) Manage relations with hotel managers Area of responsibility Real Estate Marketing Source: Hotels Magazine; Deloitte Research & Analysis

Foundation Stage: Marketing Strategy – Brand Strategy
Brand name and architecture formation requires market research to understand cultural name implications across entry and customer source markets for the strategic options chosen Keep Separate Names Merge or Link Names Create a New Name Choose One Name Reasons to choose individual, linked or new brand names Acquired brand already has a strong, established image and identity Client X brand would not add value There are potential risks to Client X brand image by linking to acquired brand Example: acquired Each brand has unique and complementary values The brand is the result of a joint venture Each company maintains significant ownership in joint venture Mandarin combined with The Oriental Support a repositioning strategy When brand value is not significant or out of line with target markets If brand value of purchased hotel has significant negative connotations Note: Rarely done and requires immense brand spend The acquired brand is weak or narrow The Client X brand adds significant value The acquisition is being integrated into an existing Client X. brand portfolio rebranded Indicative strategy for brand name change on Client X growth and expansion strategy options Option A: Organic n/a If after conducting market research, Client X is regarded as an inappropriate name for international use, option would be to create a new name One corporate name (such as Client X.) can be utilised in the case of organic growth Option B: Iconic M&A Iconic brand name should be kept separate Iconic brand name can be used for reverse branding of or linking to Division X e.g. Client X by The Ritz Carlton Leverage iconic brand name to Client X Option C: Corporate M&A Perhaps, in order to retain Client X brand strength in Location Z – Division X and / or Jeju names can remain unchanged Depending on the brand purchased the name can be merged with Client X e.g. The Rosewood Client X If after conducting market research, Client X / M&A brand are deemed not appropriate names, option would be to create a new name Depending on the brand purchased the name can be used for reverse branding of The Client X. Portfolio or vice versa Option D: Hybrid Brand architecture would have to be created to classify the different hotel types within the portfolio Iconic brand name can be used for reverse branding of The Client X. Portfolio or vice versa Note: Brand architecture refers to the collection of brands within a brand portfolio; Choosing of brand name would need to be conducted via focus groups across the gateway cities and customer source markets Source: Deloitte Research & Analysis

Foundation Stage: Marketing Strategy – Distribution Strategy
For luxury hotel expansion, there are several direct and indirect distribution channels that must be efficiently utilised, but use of channels vary by growth option Distribution Strategy Option A: Organic Option B: Iconic M&A Option C: Corporate M&A Option D: Hybrid Direct Initially the sales force plays an important role in creating awareness and consideration for the brand As portfolio grows, CRS would be one way to have seamless distribution throughout group In the longer term brand recognition and a larger luxury portfolio should drive customers to direct distribution Customers are driven directly to this brand Sales force, website, and telephone would be important channels especially when convincing customers of the M&A impact and/or reverse branding Use website of iconic brand to link to Client X Leverage CRM system Train sales force to cross sell Integrate Client X into existing CRS Use CRS for cross and up selling across Client X. new portfolio Opportunity to leverage website of iconic brand to cross-sell Re-direct traffic from corporate M&A direct sales channels Common sales force, CRM system, website, and telephone would be channels used to communicate with customers on both the M&A impact and to advertise new and re-branded properties (whether through organic growth or corporate M&A) Indirect To create awareness in the luxury space GDS and alliances should be formed and leveraged including LHW, GHA etc. Initially promotions should be targeted at travel agencies, tour operators, e-channels etc. specific to the markets Leverage GDS to improve awareness of Client X and/or reverse branding Other channels have less impact for an iconic brand but can also be leveraged to raise awareness of Client X and/or reverse branding Link GDS to internal inventory management systems for efficient and accurate customer bookings Depending on size of acquired company, leverage existing direct relationships with channels Leverage the increased importance of the larger group for existing indirect channel relationships as previously separately honed by Client X, the iconic brand, and the corporate M&A target CRM / sales force Website Telephone Walk-ins CRS Global distribution system Travel agencies Tour operators E-channels Alliances Source: Deloitte Research & Analysis

Foundation Stage: Marketing Strategy – Promotions Strategy
The reason for executing promotions and the channels used to deliver the promotions differ depending on organic or M&A strategy Promotions Strategy Option A: Organic Option B: Iconic M&A Option C: Corporate M&A Option D: Hybrid Promotions objectives Creating awareness for the brand in gateway city markets for both domestic and international travelers Use PR and high marketing budget spend to drive potential customers directly to website Use promotional budget to ‘convince’ GDS players and opinion leaders/trend setters to recommend Client X hotels Link existing promotions of iconic brand to Division X Link existing promotions of Division X to iconic brand Use PR that comes from buying the iconic brand to increase awareness for other luxury hotels in Client X portfolio and create positive association Link existing promotions of M&A brand to Division X Link existing promotions of Division X to M&A brand Use PR that comes from M&A to increase awareness for other luxury hotels in Client X portfolio Use hotel investment, luxury and luxury THL events as a platform to gain market buy-in and approval Until re-branded, link promotions of corporate M&A properties to iconic brand Use PR that comes from buying the iconic brand and the corporate to increase awareness of and create positive associations between the iconic brand and Client X brand Promotions channels Engage indirect distribution network through forming relationships rather than pricing promotions e.g. through holding THL and luxury PR events Entice luxury trendsetters to convince the wider market of the new hotel group Use ATL marketing channels to create awareness and consideration for the brand (television, luxury magazines) Use ‘emerging’ channels to promote brand e.g. hotel alliances, hospitality complementary alliances (rental cars, airlines, trains etc) Apply search engine optimisation; key words such as: luxury, [gateway city] etc. bring up Client X hotels Focus on direct distribution network for formulating promotions Focus on BTL channels for creating cross and up selling Use CRM to determine the segmentation of the customers and motivation for staying at iconic brand and at other Client X luxury hotels and determine the right type of promotion to offer (room, service, complementary gift, loyalty) Use combination of ATL (creating awareness of the new group of hotels and management); BTL channels and CRS (for fostering cross and up selling) Use CRM to determine the segmentation of the customers and motivation for staying at M&A brand and at other Client X luxury hotels and determine the right type of promotion to offer (room, service, complementary gift, loyalty) Focus on direct iconic brand distribution network for formulating promotions and cross-selling Use ATL marketing channels to create awareness and consideration for the organic growth properties (television, luxury magazines) and its positive association with the iconic brand Note: ATL = above the line marketing e.g. mass media campaigns; BTL = below the line marketing e.g. and word-of-mouth marketing Source: Deloitte Research & Analysis

Foundation Stage: Marketing Strategy – Pricing Strategy
Price setting, execution and optimisation can vary across the different growth options Pricing Strategy Option A: Organic Option B: Iconic M&A Option C: Corporate M&A Option D: Hybrid Price Setting1 Rack rate based on the price points of other recently constructed luxury hotels in close proximity Assess price reaction of other hotels that might use Client X market entry as a reason to raise prices resulting in a smaller gap than expected between lower scale segments and luxury Use comparative CRM data for determining segments and rate card Understand rack rate of competitive set of hotels in city; but most likely leave rates untouched (not advised to decrease rates) Assess existing CRM data used for determining segments and rate card which might be leveraged for current Client X portfolio Link existing CRM data used for determining segments and rate card to existing system for Client X to allow for cross and up selling Iconic brand rate remains the same; corporate M&A and organic brands should be priced consistently across Client X. new portfolio Link existing M&A CRS and CRM data used for determining segments and rate card to existing system for Client X and new organic hotels to allow for consistency and cross and up selling Price Execution Carefully construct promotions and distribution frameworks For sales force promote incentives based on ‘value/quality’ of customer For indirect sales, promote incentives based less on fees and more on actual sale Assess and remove any unnecessary promotions/incentives, generally not needed for an iconic brand Assess and remove any unnecessary promotions/incentives Use larger portfolio of hotels as ‘bargaining power’ with indirect distribution Create select arrangements where possible Use cross and up selling across hotels as a means of executing prices and reducing revenue leakage across Client X. Price optimisation Systematically use market knowledge and forecast information for room and services demand planning e.g. using competitive rate knowledge to pull customers by manipulating price at strategic times Develop interlinked CRM, GDS and pricing software (revenue/occupancy management) to determine best rates Software can seamlessly and automatically produce rates with minimal manual interpretation (segment, occupancy) Assess existing pricing and revenue management software; decide if to replicate within Client X Assess historical and forecast data for demand planning Assess existing pricing and revenue management software; and demand planning Link with CRS, CRM, GDS and replicate within Client X Company e.g. using competitive rate knowledge to pull customers by manipulating price at strategic times Systematically use market knowledge/historical data and forecast information for room and services demand planning e.g. using competitive rate knowledge to pull customers by manipulating price at strategic times Assess existing CRS, pricing and revenue management software of M&A corporate hotels Software can seamlessly and automatically produce rates based on minimal manual interpretation (segment, occupancy) Note: 1. Assumes that markets chosen have positive economic forecast e.g. GDP, business index etc. (See analysis from workshops 1 and 2); Existence of CRS/CRM/software/segmentation etc. is dependent on hotel purchased Source: Deloitte Research & Analysis

Growth Stage: Key Recommendations – Summary
There are 3 key areas of focus in the initial growth stage (subject to the outcome of the dual track strategy during the foundation stage) Organic Development Tier 2 Acquisitions Strategic Partnership (subject to outcome of dual track in foundation stage) Begin active identification of development opportunities in the prioritised Asian gateway cities Both Greenfield/Brownfield and conversion Probable locations Shanghai, Beijing and HCMC Begin active investigations into the identified 2nd tier iconic properties in Asia Probable initial locations Bangkok, Singapore and Hong Kong Research suggests there are no suitable hotel properties in Shanghai, Beijing or HCMC Issue mandate to advisors Key benefit of an acquisition strategy is the acceleration of growth and lower risk of development Implement partnership with hotel company identified during foundation stage Support development of hotel pipeline: Financial investment in hotels under development; and/or Support entry of strategic partner into AsiaPac region (subject to type of company) Within 10 years aim to open: 8 stabilised1 organically developed properties Within 8 years aim to open : 2 “iconic” properties and 6 other stabilised organically developed properties Within 10 years aim to open : 10 properties with minority investment Note: 1. New-build properties typically take 2 years from opening to stabilise revenue Source: Deloitte Research & Analysis

Growth Stage: Strategic Initiatives – Timeline overview
Whilst the initial priority is to get the management team in place, and the main push on organic development will be done by the new management, there are activities that can start immediately across all areas 0-3 months 3-6 months 6-12 months 12-24 months 24 months + Management team Mandate to head-hunters Recruit CEO and additional team based on CEO requirement Additional recruitment of team if/as required Recruitment of management for hotels as required Client X, Location X Begin initial operational improvements “quick wins” Research strategic activities, e.g. CRM system New management team to begin room renovation Implementation of plan aimed at “best in class” operational excellence Continuation of room renovation and operational excellence plan Question regarding Client X brand subject to brands acquired via M&A activity Organic Property Development Recruitment of development director (see management team) Development director tasked with sourcing individual properties and development sites in Top 5 target locations Agree contracts Initiate construction or conversion activity Integrate new properties into Client X system Iconic Property M&A Issue mandate to acquire iconic property Agree targets and make approaches Complete purchase of 1 (or max 2) properties Complete Post Merger Integration (PMI) activity Continued mandate for iconic property acquisitions on an opportunistic basis, subject to availability of funding Strategic Partnership Issue mandate for strategic partnership Appoint CEO with real estate expertise Identify and approach targets Agree terms of partnership Implement strategic partnership (ongoing) Analysis of real estate opportunities as available with strategic partner Corporate M&A Issue mandate to acquire luxury focused hotel company Complete purchase of corporate, subject to market conditions and availability of funds Complete PMI activity, specifically: 1. Leveraging platform for Client X, both operations and S&M) 2. Decide on branding and associated activities Continued mandate for corporate acquisitions on an opportunistic basis, subject to availability of funding Foundation Stage Initial growth Secondary growth Note: Timing indicative only. Actual timings may vary subject to both internal and external factors Source: Deloitte Analysis

Growth Stage: Strategic Partnership – Rationale
There are 4 steps in the strategic partnership process that will bind the two organisations together and ensure that goals are aligned 1. Client X investment in SP 2. Contribution of Client X owned properties 3. SP investment in Client X owned properties 4. Client X investment in SP pipeline Client X invests majority of available capital in the equity of the strategic partner Own stake in operating company, but not be an operator per se Client X contributes both Division X and Client X Jeju to be managed by the strategic partner Provides gateway location not in existing distribution network/portfolio Strategic partner to invest in room refurbishment of Client X properties Enables upgrading of rooms and repositioning to meet requirements of strategic partner’s brand Reduces capital investment requirement for Client X in own property, freeing up capital for either investment in larger share of equity in strategic partner (see 1) or future pipeline (see 2) Remaining Client X capital to be invested in strategic partner’s real estate pipeline on a preferential basis Client X to provide (Samsung) contacts to support development activity and provide opportunities Strategic partner to have proven track record of successful development, thereby reducing the development risk Client X to do due diligence on case by case basis prior to investment in property Source: Deloitte analysis

Growth Stage: Strategic Partnership – Company Focus
Depending on whether Client X decided to partner with an AsiaPac focused company or not will impact both the share available for Client X’s investment capacity and the “story” (rationale) for the approach AsiaPac Dominant Non-AsiaPac Dominant Hotel company with dominant focus on Asia Pacific region E.g. Shangri-La, Mandarin Oriental, Peninsula Hotel company with no or limited number of properties in Asia Pacific region E.g. Rosewood, Morgans Definition (Examples) Client X to leverage brand strength in Asia Pacific region Greater immediate impact on Client X properties Client X to leverage contacts in Asia Pacific region for growth pipeline Provide experience of Asia Pacific to management team Strategic Rationale c. <10% for initial $300m investment, with no capital for sliver investment in real estate 20% + for initial investment of $300m Potential Share Low Given already substantial scale, Client X would have a small impact on the organisation High Significant interest/impact as players are of smaller scale Client X impact Source: Deloitte Analysis

Growth Stage: Strategic Partnership – Timeline
If a strategic partnership is to be pursued, most of the actions are front loaded in first year Indicative Timeline Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Foundation Stage Corporate Governance Create autonomous hotel business Create OpCo / PropCo structure M&A Activity Target companies for investment Acquire minority stake Fix Division X Transfer management of existing hotels Repositioning spend on hotels Expansion (ongoing) Leverage contacts to find development opportunities Invest sliver equity in real estate on an ongoing, pragmatic basis Majority Acquisition To be considered, subject to: Financial returns Ability to buy/willingness to sell View on brand strength Growth opportunities “Value add” proposition Capacity to fund deal Organisational Capability / Requirement Stage 1: Initial activity Stage 2: Expansion Stage 3: Acquisition M&A Target and investment skills Contract negotiation for repositioning Real estate management expertise Individual development to assist target with development activity and act as a link to Samsung Capability should be acquired with majority stake. Critical to ensure key individuals are retained within the business Note: Buying a minority investment in a company will provide limited control over the growth strategy of that company, even with a board seat. Therefore the management contract model, segment extension and alternate models are not a choice that Client X will be able to make and therefore not covered here Source: Deloitte Research & Analysis

Growth Stage: Potential JV Structure
Based around the strategic partnership option, it may be possible to create a JV with the partner company and invest sliver equity in PropCo Example JV Structure Indicative Operations Development Brand Marketing Viable Who invests? JV PropCo External investors? Client X ? Royalties JV OpCo % control Royalties (tax) Asia-Pacific Hotel Division X Transfer of operations people Sliver equity CRM CRS Other functions TBD Strategic Partner License fee Key issues: Critical to understand how value is realised, e.g. IPO There must be firm structures in place to manage dispute resolution Source: Deloitte Research & Analysis

Growth Stage: Implications of Activities
Given the volatility and uncertainty in the current market, Client X should reduce the risk of following a single growth strategy by leveraging different growth accelerators on a pragmatic basis Strategic Partnership Iconic Properties Corporate M&A Accelerator Start search for partnership, with anticipation of achievability within 3 months Looking for assets to buy, with an aim for 2 properties, subject to available funds “Watching brief” for corporate M&A on an opportunistic basis, subject to available funds Description If strategic partner is found, a decision will need to be made as to whether to rebrand the existing portfolio or remain separate Brand of iconic property will depend on terms negotiated during acquisition process and strength of brand Organic pipeline may then either be branded “iconic” or Client X Choice regarding development pipeline, either: Branded as corporate M&A target; or Client X and organically developed properties maintained as separate Impact on Brand Any organic development pipeline that has been initiated may be leveraged by the strategic partner subject to negotiation and alignment with partner’s strategy Accelerates development, with properties open sooner than under pure organic Organic pipeline develops in parallel Initially instigated development activity can be added to the pipeline of the corporate target Development strategy to be aligned, specifically around target cities Impact on Development Given the volatility and uncertainty in the current market, it is too risky to bet growth strategy on just strategic partnership, iconic or corporate acquisition. Therefore the strategy should initially be to establish foundations (outlined previously) and plan to grow organically in 6 cities, supported by the accelerators on a pragmatic basis. The organic development activity will support each accelerator, whichever is successful over the longer term Source: Deloitte Research & Analysis

Financial Profile: Organic Roll-out Plan
Client X can add eight stabilised hotels to its portfolio within the next ten years Roll-out Plan ( ) Based on Prioritised Target Cities, Ability to Implement, and Investment Capacity Available to Client X 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Organic Growth Strategy New-build – 305 rooms in Shanghai New build – 516 rooms in Beijing New build – 384 rooms in Bangkok New build – 375 rooms in Ho Chi Minh New build – 478 rooms in Singapore New build – 463 rooms in Hong Kong Organic and Acquisition Growth Strategy Acquisition – 478 rooms in Singapore Acquisition – 384 rooms in Bangkok Note: The figures presented are strictly illustrative and based on a broad range of assumptions. It is assumed that it takes two years for new-build hotels to stabilise Source: Deloitte Research & Analysis Hotel under Construction Hotel Opened

Financial Profile: Organic Roll-out Key Assumptions
Based on the following key assumptions, we have calculated the financial impact of the two roll-out scenarios Key Assumptions Indicative Assumption Detail Interest Rates Based on applicable interest rates for target countries Construction Period 18 months, with 60% of costs in second half Construction Costs by Country Based on Davis Langdon & Seah, with land costs assumed at an additional 20% Debt to Equity Share 50/50 Ramp-up (until stabilised) 2 years Profitability by City Hotel Benchmark bespoke profitability survey less estimated fixed charges and provision for renewals at 4% Head Office Costs $3m in year 1, growing to $10m by year 4 Acquisition of Existing Asset Estimated at 17.5x EBITDA Number of Rooms per Hotel Based on average of Hotel Benchmark bespoke profitability survey sample Note: The figures presented are strictly illustrative and based on a broad range of assumptions Source: Deloitte Research & Analysis

Financial Profile: Development Costs – Organic
Construction costs are phased over 18 months, which gives the roll-out scenario highest costs in year 6 at $300m. Total cumulative development costs are c. $900m over the period Development Costs ( ) USDm Cumulative Costs: 23.9m 85.8m 190.3m 385.4m 684.8m 856.1m 892.6m Construction Costs Land Costs Note: The figures presented are strictly illustrative and based on a broad range of assumptions Source: Deloitte Research & Analysis

Financial Profile: Development Costs – Combined
A combined organic and acquisition strategy has cumulative development costs of c. $1bn Development Costs ( ) USDm Cumulative Costs: 276.6m 535.5m 635.0m 831.4m 1002.7m 1039.3m Construction Costs Land Costs Acquisition Costs Note: The figures presented are strictly illustrative and based on a broad range of assumptions Source: Deloitte Research & Analysis

Financial Profile: Cashflow – Organic
The suggested roll-out strategy will utilise $1bn of invested capital by year 8. Assuming no further development, Client X could become cash generative by year 9 Cashflow ( ) USDm Cashflow Cumulative Cashflow Note: The figures presented are strictly illustrative and based on a broad range of assumptions Source: Deloitte Research & Analysis

Financial Profile: Cashflow – Organic and Acquisition
A combined organic and acquisition strategy will require more up-front capital investment Cashflow ( ) USDm Cashflow Cumulative Cashflow Note: The figures presented are strictly illustrative and based on a broad range of assumptions Source: Deloitte Research & Analysis

Financial Profile: Illustrative IRR
Both the organic and combined approaches could yield favourable IRR. A combined approach offers lower risks but at relatively lower yields IRR Assuming Exit in Year 10 Illustrative Assumed EBITDA Exit Multiple Organic Combined 15x 30% 20% 17.5x 34% 23% 20x 37% 26% Higher organic IRR reflects risk to reward balance as Client X would benefit from return on development risk compared to accelerating the development process by buying an existing mature property Note: The figures presented are strictly illustrative and based on a broad range of assumptions Source: Deloitte Research & Analysis

Selected strategy Next steps

Next Steps: Project Activity and Implementation
There are a number of next steps Client X should undertake to fast track the implementation of whichever strategy is pursued Fast Track Implementation Process Identification and recruitment of CEO Creation of new corporate structure (autonomous hotel business) Creation of new operating model (OpCo / PropCo) – subject to tax benefits Client X brand awareness research in key Asian markets Start building land bank for development Decision on M&A approach Source: Deloitte Research & Analysis

Development of Growth & Expansion Strategy for Client X.

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Development of Growth & Expansion Strategy for Client X.

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