TORONTO (Bloomberg) — Four Seasons Hotels Inc., the manager of 74 luxury properties, received a $3.7 billion bid to be taken private by its chief executive officer, Microsoft Corp. chairman Bill Gates and Prince Alwaleed Bin Talal.Gates’ Cascade Investments LLC and Alwaleed offered $82 a share in cash, Toronto-based Four Seasons said yesterday in a statement. The bid is 28 percent higher than the company’s closing price of $63.87 on November 3. Isadore Sharp, who would retain the titles of chairman and CEO, stands to receive $288 million from the deal.

The transaction “is the only one I am prepared to pursue”, Sharp said in a conference call with investors today. The company’s shares rose more than the offer price, and investors think Four Seasons will get more bids.

Hotel companies have become takeover targets as real estate prices in the world’s largest cities rise and the cost of new construction soars. An investment group owned by the government of Dubai is purchasing Travelodge Hotels Ltd. for $1.3 billion, while Blackstone Group LP has raised $5.25 billion to buy hotels and other properties.

The offer came after Four Seasons’ shares rose 18 percent in the 12 months through last week. That trails InterContinental Hotels Group Plc’s 22 percent increase and a 35 percent gain at Marriott International Inc., owner of the Ritz-Carlton brand.

“This is a great business,” said Jim Hall, who holds 160,000 Four Seasons shares among about $665 million he helps manage at Mawer Investment Management in Calgary. “I can understand why they would take it private if the market isn’t giving them full value for it.”

Four Seasons’ shares jumped $19.10, or 30 percent, to $82.97 at 11.58 a.m. in New York Stock Exchange composite trading.

“The market is anticipating Sharp coming back and raising it a bit,” said Amit Kapoor, a hotel analyst at Rye, New York- based Gabelli & Co., which doesn’t own the stock.

Alwaleed is Four Seasons’ biggest holder, with 7.39 million shares, or 22 percent of the company, as of April 2005, according to data compiled by Bloomberg. The Gates Foundation held 1.98 million shares, or six percent, as of June this year.

Gates and Alwaleed have been collaborating for at least two years. After attending a dinner at Gates’ Bellevue, Washington, home in early 2004, Alwaleed agreed to explore ways of assisting Microsoft’s expansion in Saudi Arabia, according to a report from the Saudi state SPA news agency archived on Saudinf.com.

The two billionaires also agreed to jointly support “selected humanitarian projects in Saudi Arabia,” according to the report.

Shares of other companies that analysts expect to be acquired rose as well. Bermuda-based Orient-Express Hotels Ltd. gained $3.07, or 8.2 percent, to $40.46, while White Plains, New York-based Starwood Hotels & Resorts Worldwide Inc. increased $1.72, or 3 percent, to $60.02.

London-based InterContinental was up 22.5 pence, or 2.2 percent, to 1,038.5 pence in London Stock Exchange trading.

Sharp’s family plans to keep a 10 percent stake in the company through special voting shares, while Gates and Alwaleed will split the remainder, Four Seasons said. Sharp opened his first Four Seasons hotel in 1961 on Toronto’s Jarvis Street, not far from the city’s red light district at the time.

Sharp’s private holding company owns all of Four Seasons’ multiple-voting shares, giving him 65 percent of the votes as of April 4, according to a management circular.

“The transaction we have proposed offers the company long- term stability to pursue strategic goals,” Sharp said on the conference call.

“This proposal does not change the strategy, direction, management or leadership of the company.” Four Seasons will continue to “operate medium-sized hotels of exceptional quality,” he said.

Four Seasons’ second-quarter profit fell 42 percent as the Canadian dollar strengthened against the U.S. currency. Net income was $9.1 million, while revenue declined 9 percent to $67.8 million after the company sold its interest in New York’s Pierre hotel.

The company posted a loss last year, and net income fell during three of the previous four years.

Alwaleed is bidding through Kingdom Hotels International.

The deal conforms to Alwaleed’s interest in recognisable hotel brands, said Kapoor. Alwaleed already owns the Four Seasons’ George V in Paris among other properties.