Sparling and Cook (1999) noted that entering new international markets is beyond the capabilities of many companies, prompting many to look to other organizations for the additional resources and capabilities needed.
Companies who want to find partners to ultimately increase profits in the global market place need to critically look at a number of factors that might affect the proposed joint venture prior to committing.
This assignment looks at the international joint venture between the PLG a prominent Singaporean developer and world renowned CHG f.k.a. ‘West Paces Hotel Group’ of Atlanta, Georgia USA. This IJV formed the ‘West Paces
Hotel Group Asia’ headquartered in Singapore in 2006. It was renamed the CHG after another partnership between
WPHG and a private equity firm, Stoneleigh Capital, in December 2011.
Information/evidence/analysis
Context under which IJV was formed
In the …show more content…
Finding a better developer in Singapore or any other Asian country would depend on their track records and financial standing. An alternative to Singapore and its pro-business environs would be hard pressed but India and China are both growing markets that could have been explored. The choice of Singapore seems to be prudent in my opinion with stable environment and last year’s 4.9% growth in the economy (Emmet et al, 2012). As illustrated in (ICRA, 2012) there is large growth planned for hotels in India in all major brand hotels and with 740 million domestic travelers (in
2011) and over 6.3 million FTAs, India, after China, is considered one of the most lucrative hotel markets in the world.
Success vs. Failure Criteria
There are significant differences in circumstances in which IJVs are established, their evolution and success is therefore highly context-specific.(Elo, M, 2009). In this arrangement it is clear that a horizontal integration would be better suited with each partner having responsibility for their scope of the value chain.
The ‘bar’ set for excellence for this IJV given the partners esteemed status in their respective fields and their desire