By Phil Boeyen, ShareChat Business News Editor
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Tuesday 12th March 2002 |
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Under the terms of the deal a company called Gamma Four, which is a subsidiary of Euro & UK Property, will pay £1 in cash and take over £555.4 million in inter-company debt. It will also be responsible for paying £45 million by 2005 on a loan note issued to Thistle by one of the companies that is being sold.
Following the sale of the properties Thistle will take over management contracts for each of the hotels for 30 years.
BIL International, which holds 45.9% of Thistle, says the disposal underlines the net asset value of BIL's investment portfolio and reinforces its balance sheet.
"This is very good news for BIL shareholders. Thistle is by far our most important asset and this transaction demonstrates its true value," says BIL boss Greg Terry.
After the transaction Thistle will keep around £1 billion in hotel assets, mainly in prime London locations.
BIL says that, with its own hotels and retained management contracts over the hotels sold, Thistle will have 55 hotels under management.
"Thistle now has the management, the hotels and the balance sheet to achieve sector leading growth going forward," Mr Terry says.
Thistle chairman, David Newbigging, says the disposal represents a further significant step in the re-positioning of the company and both improves and rebalances its hotel portfolio.
"By concentrating on delivering growth through our core hotel management business, with a reduced emphasis on the capital intensive ownership of hotel properties, we expect to benefit from increased operating flexibility.
Mr Newbigging says the transaction significantly strengthens Thistle's balance sheet and leaves the company well placed to pursue potential strategic acquisition opportunities for further growth and development.
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