Late billionaire Manuel Gnana Muthu, alias MGM Muthu, is the man behind the renowned MGM Group of Hotels and Resorts, a European hospitality conglomerate with over 50 properties spread across four continents. In 2023, the group acquired Kenyan hospitality giant, Sun Africa Hotel Group.
The takeover gave MGM Group control of four prestigious hotels: Sovereign Suites Hotel and Spa in Limuru, Lake Naivasha Country Club, Keekorok Lodge in Masai Mara, and Nyali Beach Hotel and Spa in Mombasa.
In August 2023, Muthu’s hotel chain acquired the Warwick Hotel in Nanyuki, a 78-room gem set against the backdrop of Mount Kenya and Ol Pejeta.
The group also moved to lease and reopen the 4-star Silver Springs Hotel located in Nairobi’s high-end Upper Hill neighbourhood. The hotel, which is associated with the families of the late Aggrey Wahome and late president Mwai Kibaki, had closed down in 2020 due to COVID-19.
While the total cost of acquisition of the Kenyan hotels is unknown, conservative estimates place it at about US$ 50 million.
The hotels are now operating as Muthu Silver Springs Hotel—Nairobi, Muthu Warwick Mount Kenya Hotel—Nanyuki, Muthu Lake Naivasha Country Club—Naivasha, Muthu Sovereign Suites & Spa—Limuru, Muthu Nyali Beach Hotel and Spa—Mombasa, and Muthu Keekorok Lodge—Maasai Mara.
History of MGM Muthu Group
MGM Muthu Group was founded by Dr. Manuel Gnana Muthu (MG Muthu), an Indian industrialist from the southern Indian state of Tamil Nadu.
Born in 1935 to a poor family of labourers, MG Muthu attended school briefly before quitting due to a lack of school fees. In a past interview, the billionaire recounted that he found it difficult to concentrate in class on an empty stomach.
At the age of 17, he joined his father to work as a headload worker, loading and offloading ships that docked at the Chennai harbour.
Years later, Muthu began offering logistics services to small-scale clients, having mastered the ins and outs of the dock business. He developed a reputation at the Chennai port for delivering on time and exceeding his customers’ expectations.
Bigger clients would later come calling for his services, and MG Muthu formalized his business in 1967, setting up MGM Anand Transport, a logistics company that grew to win many Tamil Nadu government and private contracts at Chennai Port.
In the 1990s, MG Muthu formed MGM International Exports, which expanded his logistics services into actual import-export of goods in and out of India.
The group later expanded into hospitality, fast food restaurants, and amusement parks across India before expanding globally.
The group is currently engaged in logistics, hospitality, liquor and distillery, housing, infrastructure, movie production, entertainment, packaging, fast foods, and other forms of international trade.
MG Muthu, the founding chairman and CEO of MGM Muthu Hotels, died in 2018, leaving behind a rich legacy of hard work, consistency, and not settling.
His business empire is now being managed by his two sons: MGM Maran (director and promoter) and MGM Anand (group managing director).
MGM Muthu Group Expansion
MGM Muthu Hotels has been involved in a purchasing spree of hotels across the world, especially in Europe.
In 2017, the group splashed about GBP 10 million to acquire 5 hotels in Scotland, including the Royal Hotel (Tyndrum), Ben Doran Hotel (Tyndrum), and Dalmally Hotel (Oban).
Others were Alexandra Hotel (Oban) and Nairn’s Newton Hotel, which was a favourite holiday destination for legendary comedian Charlie Chaplin and his family in the 1960s.
The MGM Muthu Hotels now operates over 50 hotels and resorts in Portugal, Spain, England, Scotland, France, India, Cuba, and Kenya.
Tax evasion & money laundering allegations
In recent years the Muthu brothers, MGM Maran and MGM Anand, have run into headwinds with Indian authorities over allegations of tax evasion and money laundering.
Between December 2021 and April 2022, the Enforcement Directorate (ED), India’s financial crime-fighting agency, seized assets in the form of land and shares in four companies amounting to about USD 35 million belonging to the brothers.
The seized assets were penalties for siphoning off funds abroad under the garb of Oversees Direct Investments (ODI) through false declarations and structured transactions that were not approved by the Reserve Bank of India (RBI), thereby contravening India’s Foreign Exchange Management Act (FEMA).
Similarly, India’s Income Tax Department raided over 40 locations belonging to MGM Muthu businesses and family premises on allegations of tax evasion.
One of the Muthu brothers, MGM Maran, is said to have surrendered his Indian passport and taken up a Cyprus passport, perhaps to avoid ‘persecution’.
