Orient-Express shareholders led by D.E. Shaw, CR Intrinsic propose settlement

By Lisa Kerner

Charlotte, N.C., Nov. 24 - Shareholders led by D.E. Shaw Oculus Portfolios, LLC, CR Intrinsic Investments, LLC and their affiliates proposed a settlement offer with Orient-Express Hotels Ltd. in a Nov. 21 letter to the company included in a schedule 13D/A filed with the Securities and Exchange Commission.

The settlement offer included cancellation of the class B shares of the company and implementation of a classified board.

In addition, D.E. Shaw asked for the right to identify a new board director who would lead a committee to evaluate strategic alternatives for the company, the filing said.

The investors would agree to a standstill of certain shareholder activities until an appropriate period of time in advance of the 2009 annual general meeting of shareholders.

D.E. Shaw and its affiliates gave Orient-Express' board one week to respond and noted they may seek legal options if necessary.

In October, Orient-Express shareholders declined to pass resolutions proposed by D.E. Shaw and its affiliates.

As previously reported, the investors were soliciting proxies in support of amendments to the company's bylaws that would treat class B shares as "treasury shares" under Bermuda law and would cancel the class B shares.

Orient-Express, a Hamilton, Bermuda-based luxury hotel and restaurant operator, said it intended to "defend vigorously" any legal challenges to its corporate structure.

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