Bits: LVMH (surprisingly) buys Belmond, Virgin Atlantic refreshes its Savings Account, Hilton launches Asia-Pacific sale

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News in brief:

Belmond hotel group in surprise sale to LVMH

LVMH, the luxury goods group behind Louis Vuitton and many other high-end brands, has emerged as the surprise winner in the race to acquire the Belmond hotel group.  It will pay $3.2bn including existing debt, which is loose change for a company with a market capitalisation of €130bn.

LVMH already has a small hotels presence with its Cheval Blanc brand.  These are genuine ‘uber luxe’ properties, however.  Belmond is generally made up of historic properties which are past their prime and in need of investment.  Other LVMH hotel interests include Fendi Private Suites in Rome and, via its Bulgari subsidiary, a 50% shareholding in Bulgari Hotels & Resorts.

It is possible – and this is just my guess – that LVMH will cherry-pick a few hotels, such as the Mount Nelson in Cape Town (below) and the Cipriani in Venice, and resell the rest.  I could be wrong though, as LVMH definitely has the money if it does decide to upgrade all 30+ Belmond properties.  I am pretty sure that the status quo won’t be maintained as LVMH is not interested in attaching its reputation to ‘past their prime’ hotels.

The reason that the sale price is so high is that Belmond owns the freehold or long leasehold to many of its properties.  This is probably why ‘asset-lite’ groups like IHG were pushed out, because they were less willing to dilute their return on equity by doing anything as radical as physically owning a hotel.

When IHG bought the UK’s Principal Hotels recently, for example, it teamed up with a property company so that it did not need to take on the assets.  That is fairly easy to do if you’re buying a group of UK city centre hotels but a lot trickier when the assets are spread across the globe as they are here, and also include rail and cruise operations.

Mount Nelson Cape Town

Virgin Money tweaks its miles-earning savings account

Virgin Money has launched a new version of the Virgin Atlantic 1-year Flying Club Savings Account.

This is an interesting product which no-one has tried before.  You make a one-off deposit of between £1 and £1 million into a one year bond.  No further deposits and no withdrawals are allowed over the one year period.  Instead of cash interest, after one year you will receive 1,600 Virgin Flying Club miles for every £1,000 you save.

Full details are on the Virgin Money website here.

In case you are wondering exactly how this works, and whether you can escape Income Tax if you pay it on your savings (you can’t), this is your answer:

Virgin Money pays you interest based on a rate of 1.36%

Your interest is immediately taken back and used to purchase Virgin Flying Club miles at – effectively – 0.85p per mile

In terms of the income tax position, the interest should be included on any tax return and will count towards your Personal Savings Allowance, like any other savings interest

In general, I would be a buyer of Virgin Flying Club miles at 0.85p – except for the fact that I am sitting on over 1.5m of them between my wife and myself and that’s probably enough for now!  You need to compare the notional 1.36% interest rate with comparable accounts from other institutions with a similar risk profile.

A new version of this account was launched this week.  The interest rate is unchanged, but the savings term if you apply today runs to 20th January 2020.  This means that you are actually putting your money away for 13 months.

You can find out more on the Virgin Money website here.

How to earn Virgin Atlantic miles from UK credit cards

As a reminder, there are various ways of earning Virgin Flying Club miles from UK credit cards.  Many cards also have generous sign-up bonuses!

Click here to read our detailed summary of all UK credit cards which earn Virgin Flying Club miles.  That page is regularly updated with the latest special offers and will still be accurate even if you are reading this article months after publication.

HIlton Asia Sale

Hilton launches a new Asia-Pacific sale

Hilton has launched a new sale covering its properties in Asia and Australasia.  See here for details.

It includes hotels such as the Millennium Hilton Bangkok pictured above.  You might also want to take a look at the brand new Waldorf Astoria Bangkok which looks very impressive.

The deals are valid for stays up to 30th September 2019 which is surprisingly long.  There is also no rush to book unless you are travelling immediately, as these deals are available until 2nd February.

The headline saving is ‘up to 35% off’ the standard flexible rate – albeit these bookings are non-refundable, and not all hotels offer 35% – so it is worth looking to see if any existing Hilton bookings you have should be rebooked. It may also be worth cancelling redemptions and rebooking for cash if the rate is low enough.

(The discount is smaller in Mainland China, Hong Kong, Macau and Taiwan, at up to 25%.)

If you are tempted by this offer, please also remember:

to register here for the ‘double and triple points’ promotion which runs until 3rd January

to claim your Hilton Honors status match here from any other hotel status you may have

Full details of the APAC sale can be found on this special page of hilton.com.

PS. Click here to read our detailed summary of all UK credit cards which earn Hilton Honors points.  That page is regularly updated with the latest special offers and will still be accurate even if you are reading this article months after publication.

(Want to earn more hotel points?  Click here to see our complete list of promotions from the major hotel chains or use the ‘Hotel Promos’ link in the menu bar at the top of the page.)

Bits: Head into space with your Virgin miles, last call for Hilton 80%-100% buy points bonus, IHG 80% buy points bonus
Bits: €1250 British Airways Cape Town deal in Club World, 50% 'buy Avios' bonus, Cathay Pacific launches with AirPortr
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Comments

  1. Plugging the Virgin savings account is fine but for balance I wish you would also highlight the downsides of this account.

    • And what would the downsides be or what do yiu think they are?

      Rob mentioned you still have to declare the interest for tax purposes and that its a one year account and some of the other rules.

      And anyone who is thinking of this account is going to read the full T&Cs before opening an account and make an informed decision.

      • Realistically you can easily get 1.6% for a savings account for less than 1 year which means that this is costing 1p per mile, you will also be using up your tax free allowance so this means you could end up also paying further tax if you use your allowance up.

    • I’m being a bit stupid here. If VM are going to hold the money for 13 months instead of 12, does that maen I will get more than 1600 miles? The AER has not changes as far as I can see and that refers to 12 months….

  2. Brighton Belle says:

    Ok, tell us what you think we should know beyond Virgin devaluations of miles

    • That, plus the interest rate plus the absence of flexibility to do what you like with the interest which most people would likely wish they had should a devaluation happen.

      • Shoestring says:

        The notional 1.36% interest rate is there. It’s obvious you are tying yourself into receiving Virgin miles, with no cash alternative.

        What’s your point, BJ? I guess a couple of alternatives could be briefly mentioned – but HfP is not some kind of wet nurse and people need to assume basic responsibility for their own financial affairs. A 2 minute google of best buy savings a/cs would bring up plenty of alternatives.

        • Mr(s) Entitled says:

          I’d agree. Rate, liquidity, need to shop around are all mentioned front and centre.

          Assuming you went with a ‘better’ alternative could you use your cash interest to buy Virgin Miles at 0.85p? I’m not a collector or buyer. But if you need Miles it might be worth the sacrifice of a few extra bps interest.

        • The issues might be obvious but there’s always somebody…

          I guess my point is that Rob is usually good at pointing out pitfalls and limitations in his articles but not here although I appreciate it’s bits and not a full analysis. Still, as Mr(s) Entitled demonstrates it can be covered in one short sentence.

    • the_real_a says:

      I guess the “opportunity cost” is a 1 year bond, which the best buy table says is 1.65% giving a delta of 0.25% to the virgin account.

      • the_real_a says:

        sorry 0.29%

        • It would be a bit more than that if you are using the top of the best buy table- 2.05% via investec.

        • the_real_a says:

          Or 2.25% with Metro Bank for 18 months. With those rates it does seem to make the Virgin account poor value.

        • Mr(s) Entitled says:

          That depends if you want Virgin Miles and if you can buy them with your cash return elsewhere for 0.85p or if you increased return is wiped out by increased cost.

      • Yes you must use the top 1 year savings account rate to compare this deal to and that is how much the points are costing you.

  3. Gutted. I was looking forward to spending IHG points at Belmond hotels such as Machine Piccu.

  4. Hilton also have a promo for US & Carribbean on, stay 4 nights, pay for 3.
    https://hiltonhonors3.hilton.com/en/offers/100095540.htm

    Sharing because someone was recently asking about hotel offers down in the Florida keys.

  5. Ot. I have a Marriott offer on my Amex. Spend £500 before end of January 2019 for £100 off. I’m looking to stay next May. If I pay now when booking for a stay after the offer close date, does anyone know if this qualifies for the offer of £100 off?

    Can’t find anything about staying by 31/1/2019 in the terms, just paying.

    TIA

    • Should be fine – with all these Amex offers it’s when the card is charged that’s normally the issue. Watch out though as to which properties it’s valid for.

    • I think there are some reports of hotels ‘helpfully’ not charging your card immediately, even though it’s a prepay rate. Worth a call to the hotel if you don’t see the charge on you statement within a few days.

  6. Well I was fortunate enough to stay at Le Manoir Aux Quat’Saisons in Oxfordshire last week and it certainly didn’t feel “past it’s prime”.
    It was a self financed leisure trip paid for out of my tax paid earnings so was obviously a luxury treat. I haven’t stayed in enough “uber luxe” properties like this to be able to compare, and it’s perhaps hard to describe an expensive stay as “value for money”, but my wife and I felt it was worth the cost for what was a memorable experience.

    • Sussex bantams says:

      Does a “self financed leisure trip paid for me out of my tax paid earnings” mean “cash” ?

      • No, It means it wasn’t a company paid business jolly!

      • Very unlikely. Most probably payment was made using a personal credit card.
        Have you witnessed many guests booking hotels with “cash”?

        • I should think anyone using cash Vs points earning credit/charge for anything would receive a lifetime ban from Rob!

  7. Can someone please post a quick reminder on expiry if virgin miles is it 2 years unless you earn a virgin mile which resets the expiry? I have 300k in mine and mrs yuff’s account.
    Also has anyone transfer Tesco cc Ro Avios recently, transferred some from my daughters account, as they were expiring 2 weeks ago, into our household account and they haven’t arrived yet.
    Had to spend £500 over 3 accounts to stop expiry fortunately £200 went to hotels.com for the park Hyatt in Mallorca….£116 a night 😉

  8. OT: I’m annoyed with Amex Shop Small. I did a fair bit of Christmas shopping at the Winchester Christmas market and none of the purchases seems to have been eligible. No way for me to check their map, of course. Just assumed that there can’t be anything smaller than a market stall, surely?

    • Shoestring says:

      The suck it & see strategy – I like it! 🙂

    • Not sure why you couldn’t check the map? It’s only ones that show on there that count. I know plenty of places in Bath which aren’t taking it but technically are “small”, doesn’t mean they’ve signed up!

      • Gin and Tonic Please says:

        Not entirely true. I’ve had 3 shops trigger the offer, despite not being listed on the map.

      • Signed up? Pretty sure they don’t have to specifically sign up as their map has plenty which don’t accept Amex so they wouldn’t have signed up

    • Depends on how payments are handled. If a single firm provides transaction services for the whole lot, it would never trigger shop small. That, and most participating retailers are restaurants.

      • Yes but if they are on the map with this system you must have a right to claim your £5?

        • Conversely if they are not on the map you have no come back. So the suck it and see strategy is risky.

    • Seriously, you can’t take 5 minutes to check a list before embarking on a shopping trip?

    • At winter wonderland for example all the stalls seem to use izettle for their payment system and from investigating stores near where I work those that use the same system aren’t on the shop small map, even though they tick all the boxes for being a small independent business that accept AMEX. Perhaps this Christmas market is the same

      • I’m having an issue with a pub that is showing Izettle on my statement. 8x£5 I am due back but Amex want the receipts from the merchant. The address shows Sweden so is it down to the card machine they use?

    • This happens every year, and it’s a bit of a (fun?) gamble. One local butcher shown on the map doesn’t even accept Amex. Conversely, spending at a couple of local shops not shown on the map have resulted in £5 credits. Getting £5 off is nice, but don’t ever rely on it to feed your starving children!

      • Sussex bantam says:

        I paid for staff Xmas lunch (just shy of 1k) yesterday at a restaurant not shown on map. Put it all on my BAPP.

        This morning got a shop small credit. Very irritated now as I could have split it across 10 cards easily !!

      • Lewis King says:

        It’s a fun map… my favourite pub was showing on it this year (know they don’t take amex usually) but they have a new card machine! I’d have never have tried without seeing this and now I will definitely be there more often haha

      • the_real_a says:

        Izettle is a payment aggregator like paypal. It has never tracked and i seem to remember is specifically called out as excluded in the T&C`s… the issue seems to be izettle is substantially cheaper than regular terminal rental, so business`s are moving across to izettle leaving the database for the map out of date.

      • Nigel the Pensioner says:

        +1 LOL

    • Were the stalls using iZettle or similar, which do not show on your Amex statement as the retailer

      • I’ve found plenty of shops displaying shop small signs for the promo on the counter but not on the Amex map. As ever, the map is useless.

        Had a great haul this year. Come a cropper on iZettle a few times though..showing on the Amex map, but then using iZettle when you get to the store. Will be asking Amex for credit for those!

        • Actually, two of the stalls on the market used those iZettles. Didn’t know they would be off limits. You’d think that the people using them would be “small” by definition!

          Given that the market is there only one month a year, I’m not sure how the map could have helped so I just gave it a try. Might try and complain to Amex though only complained about another offer not tracking two weeks ago…

      • Have also had izettle fail to track – if izettle is a spanner in the works of this huge promotion, you’d think Amex would try to come up with a blanket solution rather than be bombarded with complaints/requests to sort out everyone’s individual transactions.

        • I am having a very good year this year with Small Shop. The few shops or cafes I have used that are not on the map have not credited but everything else is crediting so far even when emails are not received. Had one cafe that was on the list, I put my pin in and then the girl noticed it was Amex and said we don’t take it and cancelled the transaction. They obviously did as it wouldn’t have accepted my pin. Called Amex and got a manual credit. Enjoying the game!

        • Shoestring says:

          I pre-cleared with one butcher today to split the bill across 8 cards, same as I have done there the last 3 years. Got 2 beautiful beef joints all packaged for me, then the guy couldn’t work out how to do the till (though same guy did it previous years).

          Went to ask his boss who came out and said he wouldn’t do 8x £10-ish splits as the Amex transaction fee is too high. Wouldn’t discuss it or tell me the transaction fee.

        • That’s a shame it didn’t work for you this year. We have 10 cards this year and managed to get 3 shops do all 10 cards. Going for one final wine shop tomorrow then we are done.

        • RussellH says:

          Liz says:
          > They obviously did (take Amex) as it wouldn’t have accepted my pin.

          I had something like this happen last year in a pub. Put my Amex in the machine, it asked for my PIN, PIN accepted, but then transaction was declined. Barman looked at the terminal and told me that it had been declined because they did not take Amex.
          Very odd tho’!

        • I also had a fish shop that was on the map because I added it to my own list of shops to visit, went to buy some fish, wouldn’t accept the card at all, paid with IHG, checked the map when I got home and it was no longer there. Had that twice this year so cannot phone and claim. If it gets as far as the pin being entered then surely they accept it. The girl got all flustered saying she would need to speak to her boss so obviously took it but not allowed to take it. Some shops so against it because of fees and others more than happy with Amex.

          Local wine shop today said because of me telling them about Amex and our airmiles travels in the past they pushed Amex for a better deal and now take it and many customers use it. Going back in tomorrow for a few more bottles. I was telling them about our trip to Oz this year all on airmiles – the customer behind me was a young guy paying with his blue BA card. He said he was trying to get enough points for an upgraded flight so I put him on to HFP!

        • @liz

          Some machines can accept Amex but when the machine connects if they have chosen not to accept Amex in their merchant account then it will decline, tried it in a place that was on the map, very annoying.

        • I don’t think Amex could possibly have been any clearer that PayPal, Ape Pay, iZettle etc are not small merchants. It’s written clearly in every single promotion year-round, if anyone has managed not to read any of them all year that’s really on you.

          PayPal looked to buy iZettle for $2.2bn this year, if that’s your idea of a small business then I’ve bad news for you – it isn’t anyone elses!

    • Was pleased that Slam City Skates qualifies for Shop Small, if any of you want to buy your festive skate wear before or after visiting the Amex lounge in Covent Garden. The big Stanford Books works. The Christmas Stanfords (literally opposite) the lounge I didn’t try.

  9. Geoff Barrow says:

    Having stayed at a number of Belmond properties throughout the world (as well as Four Seasons, Aman, Oberoi, etc), I can see why LVMH would want to acquire the brand, and I am not sure why you hold the view that you do (particularly as you seem to think that Hilton has merit as a brand!).
    The properties may need some upgrades, but service levels are consistently high, and the iconic buildings and locations offer a great basis for a luxury hotel brand.

  10. Hilton status match, is it a literal 90 days from when youre upgraded or is it like marriott where its the current month plus 3 months?

    • I think it is a literal, I had a similar question and asked the Hilton twitter team

    • Literal 90 days

    • There was a suggestion by Rob in a previous article and this one that Hilton status match to anything including Wyndhams Rewards. They don’t, as I recently found out. They now tell me it’s just Marriott, SPG, IHG or Hyatt.

      • I thought it was the other way round, that Wyndham matched when you had Hilton status.

        • Yes, but Rob suggested once Wyndhams matched you could use that status to match with Hilton. I just looked back at the article to confirm… but notice it’s been updated to say that Hilton won’t match Wyndham, ah well…

      • Yes, Hilton seems to have stopped matching Wyndham. We added a caveat to the Wyndham article a few weeks ago.

        • I see that now, no matter, no harm done.

        • Richster says:

          Shame, I found this out too last week 🙁

          What’s the next easiest (cheapest) way to get a match up to Hilton Diamond? I have the Amex Plat statuses and even if I have to do a mattress run it with another group to qualify, that might be worth it, as I have a bunch of Hilton Asia stays coming up early next year.

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