Saturday 24 August 2019

EasyHotel bidder ups stake amid takeover efforts

The offer values the group at £140 million.

Guy Parsons, CEO of easyHotel (front right) and Kate Nichols, CEO of UK Hospitality (front left), cutting a ribbon at the opening of a new easyHotel in Old Street (Professional Images/PA)
Guy Parsons, CEO of easyHotel (front right) and Kate Nichols, CEO of UK Hospitality (front left), cutting a ribbon at the opening of a new easyHotel in Old Street (Professional Images/PA)

By Alys Key, PA City Reporter

An investment group has upped its stake in easyHotel as it attempts to take control of the group.

Luxembourg-based ICAMAP has agreed to acquire almost 8 million additional shares at 95p each, taking its total holding from 38.65% to 44.09%.

It makes the group’s offer, for which it has teamed up with Canadian pension fund Ivanhoe Cambridge, mandatory instead of conditional.

The consortium will still need acceptance of its 95p-a-share offer from 50% of shareholders, meaning it needs just another 6% to take control

However it faces opposition from the company’s founder Sir Stelios Haji-Ioannou, who has said the offer undervalues the business.

The offer values the group, which has 38 hotels in 10 countries, at £138.7 million.

Sir Stelios, who owns 27% of easyHotel through his company easyGroup, said it was “very low” and urged investors to take no action.

But the board of easyHotel has previously said the offer would allow it to expand to new cities.

Commenting on Thursday’s updated offer, easyHotel chairman Jonathan Lane said: “The independent easyHotel directors consider that the updated offer is fair and reasonable and in the best interests of shareholders, the company, its employees and wider stakeholders.”

An offer document will be sent out to shareholders in due course, setting out a timetable for the proposed takeover.

In May, easyHotel revealed that sales jumped 25.3% to £20.2 million in the six months to March 31. But it slumped to a £124,000 pre-tax loss in the period due to the temporary closure of its hotel in London’s Old Street, and depreciation.

Founded in 2004, easyHotel has 11 owned hotels with 1,200 rooms, and 25 franchised hotels with about 2,100 rooms.

Bosses had previously said they plan to open five new hotels by the end of the year and nine more by 2020, at a cost of £49 million.

PA Media

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