TIDMAHCG
RNS Number : 8182Z
Action Hotels PLC
16 December 2014
16 December 2014
Action Hotels PLC
("Action Hotels", "Action", "the Group" or "the Company")
Action Hotels acquires its first freehold land in Dubai
Action Hotels, a leading owner, developer and asset manager of
branded three and four star hotels in the Middle East and
Australia, is pleased to announce that it has agreed to jointly
acquire, with Action Group Holdings, a prime freehold plot of land
(the "Plot") located in Dubai's Healthcare City. The Plot is being
acquired directly from the Dubai government for a consideration of
$15.7 million (the "Acquisition"). This is Action's first hotel
development in Dubai.
Launched in 2002 by His Highness Sheikh Mohammed Bin Rashid Al
Maktoum, Vice-President and Prime Minister of the UAE and Ruler of
Dubai, Dubai Healthcare City ("DHCC") is a free zone mandated to
meet the demand for high-quality, patient-centered healthcare.
Through strategic partnerships, DHCC brings together a wealth of
services in healthcare, medical education and research,
pharmaceuticals, medical equipment, wellness and allied
support.
The Company together with its parent company, Action Group
Holdings, intends to develop the Plot into a 240 room three star
branded hotel, which had previously been expected to be completed
on a leasehold basis. Having considered the location and projected
investment value, Action believe that the freehold interest will
more positively impact the Group's net asset value and EBITDA
levels whilst giving greater control over the development of the
hotel. In addition, Action Hotels will have an option to acquire
the remaining 50 per cent. of the Plot from Action Group
Holdings.
There are currently no operating 3 star hotels in Dubai's
Healthcare City and the Board of Action believes this will allow
the Company to attract the families and friends of medical patients
and will address the demand for quality affordable accommodation in
the area. Incoming travellers are also on the rise, with Dubai
Airport reporting a 6.2 per cent. increase in passenger volume
between 2013 and 2014. In addition, with the World Expo being held
in Dubai in 2020, the region is expecting an influx of over 25
million visitors. 70 per cent. of visitors will come from overseas
and therefore demand for hotel accommodation is forecast to
significantly exceed the current supply, guaranteeing high
occupancy and average room rates for hotels in the region.
The 26,312 square foot plot of land is being acquired from the
Dubai Healthcare City at a cost of $15.7 million jointly with
Action Group Holdings. By reason of Action Group Holdings being a
majority shareholder in Action Hotels, the Acquisition constitutes
a related party transaction under AIM Rule 13 of the AIM Rules for
Companies. The independent directors of the Company, having
consulted with the Company's nominated adviser, finnCap, consider
that the terms of the Acquisition are fair and reasonable insofar
as its shareholders are concerned.
The Company is finalising the financial completion of the
Acquisition via secured debt finance from a regional bank.
Alain Debare, CEO of Action Hotels said: "I'm delighted that we
are to become joint freeholder of this desirable plot of land. Our
ability to source and secure this very much in-demand plot is a
testament to our connections and networking within the region to
develop our economy and midscale hotels growth strategy across the
Middle East. This hotel fits with our strategy to provide economy
and mid market hotel rooms in key locations. Dubai Healthcare City
has firmly established itself as the region's leading medical hub
and drives a strong demand for accommodation. The strategic
location is expected to drive strong demand for branded economy
hotel rooms from nearby medical facilities, schools and
businesses."
For further information:
Action Hotels plc +44 (0) 20 7907 9663
Alain Debare, Chief Executive Officer
Katie Shelton, Director of Corporate Affairs
finnCap (Nominated adviser & broker) +44 (0) 20 7220
0500
Matthew Robinson / Grant Bergman / Scott Mathieson
About Dubai Healthcare City (DHCC)
Launched in 2002 by His Highness Sheikh Mohammed Bin Rashid Al
Maktoum, Vice-President and Prime Minister of the UAE and Ruler of
Dubai, Dubai Healthcare City (DHCC) is a free zone mandated to meet
the demand for high-quality, patient-centered healthcare.
Through strategic partnerships, DHCC brings together a wealth of
services in healthcare, medical education and research,
pharmaceuticals, medical equipment, wellness and allied
support.
Located in the heart of Dubai, DHCC comprises two phases. Phase
1, dedicated to healthcare and medical education, covers 4.1
million square feet, and Phase 2, which is dedicated to wellness,
will cover 19 million square feet. Development in Phase 2 is
underway.
DHCC, overseen by the Dubai Healthcare City Authority (DHCA),
operates through four divisions:
-- Healthcare: The DHCC is home to more than 120 medical
facilities including hospitals, outpatient medical centers and
diagnostic laboratories with more than 4,000 licensed
professionals. Through the expertise of leading medical
institutions and providers, patients have access to the A-Z of
quality healthcare.
-- Education and Research: Through the Mohammed Bin Rashid
Academic Medical Center (MBR-AMC), DHCC aims to establish an
integrated academic and clinical environment to build capacity and
advance medical education in the region.
-- Investment: DHCC offers medical and healthcare providers with
a 'one-stop shop' solution to set up operations and avail of free
zone benefits. The investment product portfolio has clinical,
commercial, retail, business centre and free-hold land.
-- Regulatory: Under DHCA, the Centre for Healthcare Planning
and Quality (CPQ) is an independent regulatory body responsible for
licensing healthcare providers and professionals, and setting and
maintaining international best practice in healthcare delivery and
patient care within DHCC.
For further information, please visit: www.dhcc.ae
This information is provided by RNS
The company news service from the London Stock Exchange
END
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