Naughton investment in Park Hotel is debt-equity mix, worth in excess of €1m
A deal by businessman Fergal Naughton to invest in Kenmare's five star Park Hotel is a mixture of debt and equity, and worth "substantially more" than €1m, according to the hotel's managing director John Brennan.
Brennan - one of the other owners of the hotel alongside his brother, well-known TV personality Francis Brennan - would not reveal the precise amount Naughton is investing, but documents filed in the Companies Registration Office (CRO) show the Glen Dimplex boss has invested €1m in exchange for shares.
Separate documents at the CRO show Naughton has also taken a charge over the assets of Beechside Company Ltd - an entity behind the hotel.
Naughton - the chief executive of Glen Dimplex - said he had been a customer, guest and admirer of the hotel "for many years".
John Brennan said the hotel in Kenmare, Co Kerry was free of bank debt after the deal. Accounts filed recently show that at the end of 2015 Beechside Company owed some €7.4m - €2.3m due within one year and €5.1m due in more than one year.
It made a profit of €211,155 in the year, and Brennan said that 2016 had been a better year of trade for the hotel.
He told the Sunday Independent that the deal was "a substantial investment that has given us the ability to look to the future with confidence and to ensure that the property will trade at the upper end of the five star market for the future...it does mean that we have an ability to reinvest in the Park Hotel to a level that we wouldn't be able to do without this.
"The international hotel industry has seen savage investment in the upper end of products, and Ireland has seen that as well. It is very, very difficult to put a property into that bracket without outside investment. Coming from five years of abysmal business in the country, in every property on the West Coast, it is nigh-on impossible from existing resources to fund the investment that is required to compete.
"As an owner, you have two choices, you can sell, or you can bring an investor. And thankfully, Fergal was there."
Francis Brennan said in a statement that he was "very pleased" to bring the Glen Dimplex boss on board, adding that he had "spent [his] whole professional life in the Park Hotel Kenmare and nothing is closer to [his] heart.
"It is very personal to me and it is not everyone I would share it with," he said.
Following the deal, which emerged yesterday, the shareholders in the company are the Brennan brothers and Naughton, with the Brennans retaining control.
John Brennan said some of the money would be used to refurbish parts of the interior.
"We're not talking about building 100 bedrooms, we're talking about reinvesting in the existing product and bringing it to a level that can compete on the international stage," he said.
"We're talking about providing the south west of Ireland with a property that is equal in facilities and quality to the investment that has been made in other properties in the country in recent years."
Sunday Indo Business