InterContinental Hotels Group (IHG) has agreed to sell its InterContinental Paris – Le Grand to Constellation Hotels France Grand, for €330m ($406m).

IHG noted that the terms of the transaction are in line with the announcement made on 7 August 2014.

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In August, the group received a binding offer from Constellation to acquire the property. As per the terms of the offer, IHG will retain a 30-year management contract on the hotel, with three 10-year extension rights at its discretion, giving an expected contract length of 60 years.

In addition, the offer includes the management fees of around €4m ($5m) per annum.

Located in the heart of Paris, the hotel has 470 guest rooms, including 70 suites. It was opened in 1862 and has operated under the IHG brand since 1982.

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At the time of receiving binding offer, IHG CEO Richard Solomons said: "The InterContinental Paris – Le Grand is an exceptional property and is an iconic hotel in our portfolio.

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"This announcement demonstrates the continued successful implementation of our asset-light strategy and the strength of our relationship with Constellation, following its recent purchase of InterContinental London Park Lane and its majority investment in InterContinental New York Barclay."

Subject to the satisfaction of certain standard conditions, the transaction is expected to be completed in the first quarter of 2015.

IHG has a portfolio of nine hotel brands and franchises, leases, manages or owns around 4,700 hotels and 697,000 guest rooms in nearly 100 countries, with almost 1,200 hotels in its development pipeline.