The Rafaelp group will hold 51 per cent stake in the venture and IHHR, along with Ingo Schweder, managing director of Rafael Hotels South Asia, will hold the balance.

The joint venture will see the setting up of a Rs 44-crore destination resort and spa, "Ananda-In the Himalayas" which is slated to open to guests by early 2000. The spa will be owned by Indian Hotels and Resorts while Rafael will manage and service the resort.

Schweder said: "The main reason for the compapny's foray into India is its great potential for super-luxury and service-driven hotels."

The other projects planned by the company include a Thalassotherapy Spa in Goa for which land has already been acquired. Further negotiation for acquisition of a 19-acre beach front in Kerala with independent luxury villas and private pools is at an advanced stage.