Option to Reinvest

India Hospitality Corp.
19 June 2007


For Immediate Release                                        19 June 2007



 India Hospitality Announces US $110 Million Deal to Form a Growing Diversified
                        India-Based Hospitality Company

  Sellers Retain Option to Reinvest up to US $75 million in India Hospitality


New York, NY. - June 19, 2007 - India Hospitality Corp. (LSE: IHC, IHC or India
Hospitality), today announced its intention to acquire India-based Mars
Restaurants Private Limited (MRPL or Mars), an emerging hotel and restaurant
company, and SkyGourmet Catering Private Limited (SCPL or SkyGourmet), an
airline catering company operating out of four locations in India, for
approximately US $110 million to create a diversified hospitality company
servicing the rapidly growing Indian travel and leisure marketplace from
affiliates of Navis Capital Partners, a private equity firm with offices in
Kuala Lumpur, Hong Kong, and Bangkok, and certain private shareholders.


Under the terms of the acquisition agreement, the sellers of MRPL and SCPL will
receive approximately US $110.0 million of which approximately US $91.6 million
will be payable in cash with the remainder in IHC ordinary shares on completion
of the transaction. Additional consideration may become payable if the
businesses achieve certain performance targets.


Upon completion of the transaction, current India Hospitality shareholders will
own approximately 88.9% of IHC and insiders, including Hayground Cove Asset
Management and Navis Capital Partners, will hold approximately 51.1%. Affiliates
of Navis Capital Partners and Mr. Sanjay Narang, the founder of both SkyGourmet
and Mars, will continue to play an active role in the management of the combined
businesses going forward.


Navis is retaining an option to reinvest a substantial portion of the sale
proceeds into IHC. Navis and its affiliates will be granted an option to
subscribe in aggregate for up to US $75.0 million in cash for new IHC ordinary
shares, which, if exercised in full, would result in its ownership interest in
IHC increasing to approximately 20.7% on a fully diluted basis.


Under the proposed transaction IHC has also agreed, subject to certain
conditions, to purchase from Navis and its affiliates, Nirula's, a rapidly
growing quick service restaurant chain with strong brand recognition throughout
India and an additional hotel, which could provide a future re-branding
opportunity for the Gordon House brand.


Sanjay Narang, President of Mars, commented: 'With a broad and experienced
management team already in place, we view this merger with India Hospitality as
a unique platform to leverage our core competencies and operating experience.
IHC's vision and the support of its board will allow us to grow the business and
become a leader in the Indian lodging, leisure and travel industry. With the
economic growth India is currently experiencing combined with a growing middle
class, we believe we are on the cusp of a strong growth cycle and are excited to
be partnering with IHC.'


Jason Ader, Chairman and CEO of India Hospitality added: 'We have long felt that
India holds great potential for growth in the lodging, leisure, travel and
support industries in which Mars and SkyGourmet operate. The rising purchasing
power of the Indian consumer combined with the rapid emergence of low-cost
airline carriers is expected to drive strong airline passenger growth. This
growth is driving major infrastructure investments in airports which will create
substantial expansion opportunities for hotels, restaurants and airline catering
services. Further infrastructure investment in shopping malls and office parks
creates additional opportunities to leverage these restaurant brands in food
courts. I'm confident that combining the long-established and successful
operating history of these businesses with the stronger capital structure
provided by this transaction will position IHC to better capitalize on these
growth propects.'


Mars operates two Gordon House Hotels, a modern four-star hotel chain catering
to both the Indian business and high-end leisure traveler markets. For the last
several years domestic tourism has continued to rise at double digit rates. With
demand for hotel rooms expected to outpace industry supply growth, the Gordon
House chain is poised to participate in this expected demand for hotel rooms
over the long-term. Mars also has a diversified portfolio of restaurants, with
eight primary brands covering a wide range of segments, including family, casual
and over-the-counter dining. Several of the popular brands include 'Not Just
Jazz By The Bay', 'Tendulkar's', 'All Stir Fry' and 'Just Around The Corner'.


SkyGourmet is an airline catering company in India currently operating from four
locations with plans to expand to up to 12 by 2009. With the airline industry
expected to expand from 47 million passengers in 2006 to over 100 million in
2010, SkyGourmet is well-positioned to participate in this travel boom with
plans to increase its aggregate capacity from 25,000 meals served a day to an
anticipated 72,000 meals per day by 2009.


'Among the core competencies of Mars is the ability to create successful brands
across several market segments,' said Richard Foyston, founding partner and
Managing Director of Navis. 'SkyGourmet is a unique company able to deliver a
high quality, high volume product within a demanding and time-sensitive
environment. We expect the combination of these businesses will provide for
significant synergies and create a meaningful competitive advantage. With the
expected growth of the Gordon House Hotels, the combined company is
well-positioned to leverage these businesses and offer a complete lodging and
dining experience to the growing business and tourist traveler.'


The transaction is expected to be fully funded with available cash and the
issuance of new ordinary shares of IHC. Upon completion of the transaction, IHC
will retain its name, and expects to have approximately 24.4 million ordinary
shares in issue. On a fully diluted basis, IHC expects to have approximately
58.7 million shares in issue. Cash on hand of the enlarged group immediately
following the closing of the transaction is expected to be approximately US
$10.2 million with total debt on the books as of May 31, 2007, of approximately
US $24.2 million.


In a demonstration of its support of IHC and the acquisition, Hayground Cove
Asset Management (through the funds and accounts it manages) has agreed to
purchase from IHC up to the number of ordinary shares for which repurchase
rights are exercised at the same price per share for which they are required to
be repurchased by IHC. As the acquisition will constitute a Qualifying Business
Combination under the terms of IHC's initial public offering in July 2006, IHC
ordinary shareholders voting against the acquisition will have certain rights to
require IHC to repurchase their ordinary shares. Further details as to
repurchase rights and Hayground's commitment will be contained in the Admission
Document to be sent to IHC's shareholders.


The acquisition of Mars and SkyGourmet is classed as a reverse acquisition under
the AIM Rules for Companies and requires the approval of IHC's shareholders. A
proxy statement and admission document for the purposes of the AIM Rules for
Companies (Admission Document) containing further information on the acquisition
and related transactions and a notice convening an Extraordinary General Meeting
of the shareholders of IHC to approve the acquisition and certain related
matters is expected to be published and sent to shareholders shortly. Pending
the publication of the Admission Document, trading in IHC's ordinary shares and
warrants on the Alternative Investment Market of London Stock Exchange plc (AIM)
will be suspended in accordance with the AIM Rules for Companies.


The Extraordinary General Meeting of the shareholders of IHC to approve the
acquisition of MRPL, SCPL, and certain related transactions is expected to be
held in mid-July 2007 and IHC expects the acquisition to close and the shares of
India Hospitality to be re-admitted to trading on AIM on the business day
following the Extraordinary General Meeting.



About Mars

Mars was incorporated in 2000 by Mr. Sanjay Narang and his management team with
the objective of operating and managing restaurants. Since its incorporation,
Mars has diversified into bakery outlets and operating and managing food courts
and hotels. For the nine months ending December 31, 2006, MRPL had audited
revenues of approximately US $7.2 million. The MRPL group currently employs over
550 people.

About SkyGourmet

SkyGourmet was incorporated in 2002 and is headquartered in Mumbai. SkyGourmet
currently provides inflight catering services to a number of domestic and
international airlines, including Jet Airways, Kingfisher Airlines, Air India
Express, Indian Airlines, Malaysian Airlines and Air France. It has operations
in Mumbai, Bangalore, New Delhi and Pune. For the nine months ending December
31, 2006, SCPL had audited revenues of approximately US $11.7 million.
SkyGourmet currently has over 1,150 employees.






About India Hospitality Corp.

IHC is a blank-check company created to initially acquire Indian businesses or
assets in the hospitality, leisure, tourism, travel and related industries,
including but not limited to hotels, resorts, timeshares, serviced apartments
and restaurants.


In August 2006, IHC raised US $103 million in an IPO and private placement and
is listed on the AIM, a market operated by London Stock Exchange plc, under the
ticker IHC. The Company was sponsored and advised by Hayground Cove Asset
Management LLC, a New York-based investment management firm with approximately
US $2.8 billion in gross assets under management. Jason Ader, IHC's Chief
Executive Officer and Chairman of the Board, is the Chief Executive Officer of
Hayground Cove Asset Management. Mr. Ader has a strong background in the leisure
and hospitality industries. Prior to founding Hayground Cove, he was a senior
Managing Director at Bear Stearns & Co., Inc., supervising coverage of the
lodging and hospitality industry and was a top ranked analyst by Institutional
Investor Magazine's All-American Research Team for nine consecutive years.


Banyan Tree Capital is IHC's exclusive financial advisor in connection with the
transaction. Proskauer Rose LLP, led by Jeffrey Horwitz, is overall transaction
counsel for IHC.


For Further Information Contact:
Investor Relations Contact: ICR Inc.
William Schmitt
203-682-8200


Media Contact: Buchanan Communications
Richard Darby, Isabel Podda
[phone]


Nominated Adviser and Broker: Deutsche Bank
Mumtaz Naseem
[phone]



              Cautionary Note Regarding Forward Looking Statements


Some of the information contained in this announcement constitutes
forward-looking statements. You can generally identify these forward-looking
statements by their use of words such as 'may,' 'expects,' 'anticipates,'
'contemplates,' 'believes,' 'estimates,' 'intends,' 'plans,' 'will,'
'potential,' 'should,' and 'continue' or, in each case, their negative or other
variations or comparable terminology. Such statements include any statements
that are not statements of current or historical facts. These forward-looking
statements are based on the current expectations of IHC's management, but actual
results may differ materially due to various factors.


By their nature, forward-looking statements involve risks and uncertainties
because they relate to events and depend on circumstances that may or may not
occur in the future. IHC cautions you that forward-looking statements are not
guarantees of future performance and that IHC's actual results of operations,
financial condition and liquidity, and developments in the industry in which IHC
operates may differ materially from those made in or suggested by the
forward-looking statements contained in this announcement. In addition, even if
IHC's results of operations, financial condition and liquidity, and developments
in the industries in which IHC operates are consistent with the forward-looking
statements contained in this announcement, those results or developments may not
be indicative of results or developments in subsequent periods.


These forward-looking statements are subject to numerous risks, uncertainties
and assumptions about IHC, Mars and SkyGourmet. You are cautioned not to place
undue reliance on these forward-looking statements, which speak only as of the
date of this announcement, and might not occur in light of these risks,
uncertainties and assumptions. All forward-looking statements included herein
attributable to IHC or any person acting on IHC's behalf (including statements
about Mars and SkyGourmet) are expressly qualified in their entirety by the
cautionary statements contained or referred to in this section. Except as
required by applicable law, IHC undertakes no obligation and disclaims any
obligation to publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise, unless otherwise
required to do so by the AIM Rules for Companies.

Deutsche Bank AG is authorised under German Banking Law (competent authority:
BaFin - Federal Financial Supervising Authority) and with respect to UK
commodity derivatives business by the Financial Services Authority; regulated by
the Financial Services Authority for the conduct of UK business. Deutsche Bank
is acting exclusively for IHC. and no-one else in connection with the
acquisition and related transactions and other matters referred to in this
announcement and will not be responsible to anyone other than IHC. for providing
the protections afforded to clients of Deutsche Bank AG nor for providing advice
in relation to the acquisitions and related transactions or any matter referred
to in this announcement.

Deutsche Bank is IHC's nominated adviser and broker for the purposes of the AIM
Rules for Companies. Its responsibilities as IHC's nominated adviser and broker
under the AIM Rules for Nominated Advisers are owed solely to London Stock
Exchange plc and not to IHC, any director of IHC or any other person.

No offer or invitation to purchase or subscribe for ordinary shares in or
warrants to purchase or subscribe for ordinary shares or warrants of IHC is
being made by this announcement.





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