This will enlarge the two groups' worldwide network to encompass 169 properties in 63 countries and territories.

The addition of the 22 properties - 21 throughout Japan and one in China (the 616-room Quingdao Hai Tian Hotel on China's north-east coast) - is effective from August 3, 2001.

Commenting on the expansion of the alliance, Le Meridien president and managing director Bernard Lambert said: "Our relationship with Nikko over the past year has had an extremely positive impact on Le Meridien's business. We are delighted to be able to further strengthen our alliance now by including all hotels in Japan."

Mr. Shosuke Machida, chairman, president and CEO of JAL Hotels Company, Ltd. (operating company of Nikko Hotels International), added, "We are very pleased that our unique business partnership with Le Meridien has been so fruitful for both companies. The deepening of this relationship in its second phase will offer both Nikko Hotels' and Le Meridien's guests even greater convenience and choice in their travel planning. We are well aware that what benefits our guests will also benefit both of our companies."

Le Meridien and Nikko Hotels International signed their historic global sales, marketing and reservations alliance on April 3, 2000, initially encompassing all Nikko Hotels properties outside of Japan - in Europe, North and Central America and Asia Pacific. Since then, Le Meridien has recorded a 30 percent increase in its business from the hospitality industry's important Japanese market. The increase has resulted from several sales and marketing initiatives Le Meridien implemented shortly after the alliance began. These include printing a Japanese version of its hotel directory and distributing it to key corporate accounts and leisure operators in Japan; producing joint directories; and increasing its presence at travel trade shows and joint road shows in Japan. The two companies have also linked their web sites.

The JAL Mileage Bank loyalty program has also provided Le Meridien with a 42% increase in the number of Japanese stays at its properties in the UK, France, Italy and Spain.

"Through inclusion in Le Meridien's promotions, the alliance has given Nikko Hotels wide exposure in markets such as Israel and the Middle East, in Africa and parts of Europe where we do not have properties," explained Shosuke Machida. "Just one example of this successful relationship is that Le Meridien's sales force has booked group business for Nikko Hotels properties, in one case alone worth about $500,000 of revenue."

In one promotion, Le Meridien included appropriate Nikko Hotels properties in its seasonal Le Meridien Passport sales promotion program last winter, which resulted in sales of nearly 10,000 room nights worth $1.5 million in revenue. The alliance has also brought Nikko Hotels 58 new corporate accounts and 32 new wholesaler accounts.

At the time of signing the strategic alliance last April, Le Meridien's Japanese customer base was nine percent of its total business, with the aim of increasing that figure to 12 percent within three years. Just 15 months into the alliance, the increase is already 11 percent - representing an increase of 125,000 room nights.

"With this 30 percent increase, Japan is now our third revenue-generating market and we have outperformed the competition, "added Bernard Lambert. "This could not have happened without our partnership with Nikko Hotels, which has contributed to the current success of Le Meridien.

"This is only the first phase. For the very near future, we have even more ambitious plans, which include the exchange of staff and closer distribution channels, such as reservations and loyalty programs, plus increased joint sales activity. "

The alliance gives Le Meridien an increased presence in Asia Pacific and certain areas of North and Central America (such as San Francisco and Mexico City), thus giving it a combined marketing portfolio of 169 hotels in 63 countries and territories. For Nikko, it offers an increased presence in one of its key markets - Europe - where Le Meridien currently has 48 hotels.

Nikko Hotels International is operated by JAL Hotels Company Ltd., a subsidiary of Japan Airlines. It has 42 hotels (14,924 rooms) worldwide in Europe, North America and Asia Pacific. In addition, JAL Hotels Company also operates JAL City Hotels, a chain of mid-priced hotels for business travellers in Japan, as well as independent hotel properties.

Luxury global hotel group, Le Meridien, has a worldwide portfolio of 127 upscale hotels (34,329 rooms) in 55 countries, most of which are located in the majority of the world's top cities and resorts throughout Europe, the Americas, Asia Pacific, Africa and the Middle East.