TIDMPPH
RNS Number : 5050S
PPHE Hotel Group Limited
21 December 2016
21 December 2016
PPHE Hotel Group Limited
("PPHE Hotel Group")
Transfer of Assets
PPHE Hotel Group, which together with its subsidiaries (the
"Group") owns, leases, develops, operates and franchises full
service upscale and lifestyle hotels in major gateway cities,
regional centres and select resort destinations, predominantly in
Europe, announces that it proposes to transfer its German and
Hungarian operations (consisting of companies and hotel properties)
to its non-wholly owned subsidiary Arenaturist d.d ("Arenaturist")
in exchange for 1,091,250 new shares in Arenaturist (the "Capital
Contribution"), valued at forty seven pounds (GBP47) per share
(using the average traded price of an Arenaturist share on the
Zagreb Stock Exchange in the week preceding the Capital
Contribution). The Capital Contribution is subject to the approval
of the Arenaturist Management Board, such approval to be considered
at a meeting expected to be held on 23 December 2016. The Capital
Contribution is consistent with PPHE Hotel Group's strategic plans
to develop Arenaturist into a substantial Central and Eastern
European leisure and hospitality company with a unique business
model that would entail owning and managing its own assets and
those of others primarily under the Park Plaza brand.
Background
PPHE Hotel Group indirectly owns 65.63% of the issued share
capital of Arenaturist through its wholly-owned subsidiaries Euro
Sea Hotels N.V. and Dvadeset Osam društvo s ograničenom
odgovornošću za turizam, ugostiteljstvo i usluge ("Dvadeset
Osam").
On 31 October 2016, Arenaturist's Croatian operating
subsidiaries, Arenaturist Zlatne stijene d.o.o., Arenaturist hoteli
d.o.o. and Arenaturist turistička naselja d.o.o. were merged into
Arenaturist having previously been sold to Arenaturist by a
wholly-owned subsidiary of PPHE Hotel Group for cash consideration
of HRK 108.55 million (EUR14.4 million) on 30 June 2016.
On 21 November 2016, Arenaturist's shares were admitted to the
Official Market of the Zagreb Stock Exchange having previously been
admitted to the Regular Market of the Zagreb Stock Exchange. This
premium listing was a significant step for Arenaturist, bringing
with it higher standards of corporate governance. It is expected
that such a move will improve the liquidity of trading in
Arenaturist's shares and raise Arenaturist's profile both
domestically and internationally.
At the Arenaturist Shareholders' Meeting held on 31 August 2016,
its shareholders authorised the Management Board to increase the
share capital of Arenaturist by up to fifty per cent within an
eighteen month period in order to acquire hotels and hotel
operations owned by the Group, as well as a licence to use one or
more of the Group's brands in certain countries in Central and
Eastern Europe (the "Decision").
Pursuant to the Decision, new Arenaturist shares may be issued
in consideration for a contribution in kind and/or rights.
Furthermore, under the Decision, the Management Board is authorised
to exclude any pre-emptive rights of the existing Arenaturist
shareholders when issuing such new shares.
The Capital Contribution
In accordance with the Group's strategic plans for the
development of Arenaturist into a strong leisure and hospitality
company in Central and Eastern Europe, PPHE Hotel Group proposes to
contribute its German and Hungarian operations (consisting of
companies and hotel properties held by Sugarhill Investments B.V.
("Sugarhill"), which currently forms part of the Group) in exchange
for 1,091,250 new shares in Arenaturist. The fair value of
Sugarhill's share capital against which Arenaturist will issue new
shares was ascertained by an independent Big Four accounting firm
which was retained by Arenaturist's Executive Directors. The value
is also expected to be verified by the auditor appointed by the
Court pursuant to the Croatian Companies' Act. This contribution
will add a portfolio of 7 owned and/or leased upscale hotels and 1
managed upscale hotel comprising 1,295 bedrooms (the "Hotels") to
Arenaturist's and its subsidiaries' (the "AT Group") portfolio. The
Hotels include properties in key tourist and business centres such
as Berlin, Budapest, Cologne and Nuremberg. The Capital
Contribution will diversify the AT Group's revenues across
countries, hotel types, market segments and hotel operating
agreements whilst reducing the seasonality of its operations. It is
expected that this will also give rise to significant operating
synergies and create a unique hospitality company in the
region.
In order to further expand the AT Group in Croatia and other
countries in the region, PPHE Hotel Group will transfer the hotel
management agreements for the Hotels to a newly established
subsidiary, Arena Hospitality Management d.o.o., ("Arena
Hospitality") (a wholly-owned subsidiary of Sugarhill). PPHE Hotel
Group will also grant an exclusive sub-license (the "Licence") to
Arena Hospitality to use the Park Plaza(R) brand in the territories
of Croatia, Germany, Austria, Bulgaria, Slovenia, Bosnia and
Herzegovina, Montenegro, Kosovo, Serbia, Albania, Romania,
Moldavia, Ukraine, Slovakia, the Czech Republic, Poland, Belarus
and Hungary (the "Territory").
The Hotels are owned or leased by Sugarhill and its subsidiaries
(the "Sugarhill Group"). Various members of the Sugarhill Group are
party to the hotel operating agreements for each of the Hotels, the
leases to the Hotels and the Licence.
Hotels to be Transferred
The table below details the Hotels to be transferred to
Arenaturist pursuant to the Capital Contribution:
Hotel Location No. of units Categorisation (Co) Operating Management Year
ownership lease agreement
-------------- --------------- ------------- --------------- -------------- -------------- -------------- -----
art'otel
berlin
kudamm Berlin (GER) 152 4* x x 2000
-------------- --------------- ------------- --------------- -------------- -------------- -------------- -----
art'otel
berlin mitte Berlin (GER) 109 4* x x 2000
-------------- --------------- ------------- --------------- -------------- -------------- -------------- -----
Park Plaza
Berlin
Kudamm Berlin (GER) 133 3* x x 2006
-------------- --------------- ------------- --------------- -------------- -------------- -------------- -----
Park Plaza
Wallstreet
Berlin Mitte Berlin (GER) 167 4* x x 2006
-------------- --------------- ------------- --------------- -------------- -------------- -------------- -----
art'otel
cologne Cologne (GER) 218 4* x x 2010
-------------- --------------- ------------- --------------- -------------- -------------- -------------- -----
Park Plaza Nuremberg
Nuremberg (GER) 177 4* x x 2016
-------------- --------------- ------------- --------------- -------------- -------------- -------------- -----
art'otel
dresden Dresden (GER) 174 4* x 2000
-------------- --------------- ------------- --------------- -------------- -------------- -------------- -----
art'otel
budapest Budapest (HUN) 165 4* x x 2000
-------------- --------------- ------------- --------------- -------------- -------------- -------------- -----
TOTAL 1,295 3 4 8
------------------------------- ------------- --------------- -------------- -------------- -------------- -----
(1) First year of operation under the Park Plaza or art'otel
brand
(1) Year of commencement of operations under the Park Plaza or
art'otel brand
Overview of Sugarhill's key financials
Key Revenue Indicators Of Sugarhill Hotels
---------------------------------------------------------------------------------
2016E
-----------
Average ADR (EUR) 85.3
--------------------------------------------------------------------------------- -----------
Average Occupancy 74.4%
---------------------------------------------------------------------------------
Average RevPar (EUR) 63.5
--------------------------------------------------------------------------------- -----------
(1) Relates only to Room Revenues and does not include Park Plaza Nuremberg, which had its
soft opening in June 2016 and art'otel dresden which is solely managed by Sugarhill
Following the Capital Contribution, Arenaturist will become the
majority owner of the Sugarhill Group, and thereby, indirectly, the
"owner" of the Hotels and the Hotel operations which PPHE Hotel
Group owns independently or with partners in Germany and Hungary,
including the hotel management agreements and the licence to use
the brand Park Plaza(R) as stated above.
In order to continue to benefit from the opportunities provided
by the global Park Plaza Hotels & Resorts system and the
partnership of the Group with Carlson Rezidor, the Hotels will each
enter into a licence, sales and marketing agreement with a member
of the Group which will greatly enhance Arenaturist's ability to
attract and retain guests and provide them with a world-class
service in a globalising market place.
The Capital Contribution is subject to the approval of the
Arenaturist Management Board, such approval to be considered at a
meeting expected to be held on 23 December 2016. A further
announcement regarding the outcome of this meeting will be made in
due course.
Boris Ivesha, President & Chief Executive Officer of PPHE
Hotel Group, said:
"This transaction is a key step in the implementation of our
strategy to develop Arenaturist into a strong leisure and
hospitality company in Central and Eastern Europe. The transfer of
these hotel assets provides Arenaturist a platform upon which to
expand its operations in Central and Eastern Europe."
This announcement contains inside information for the purposes
of Article 7 of Regulation 596/2014.
Enquiries
PPHE Hotel Group Limited
Chen Moravsky, Deputy Chief Tel: +44 (0)20
Executive Officer 7034 4800
and Chief Financial Officer
Hudson Sandler LLP
Wendy Baker / Jocelyn Spottiswoode Tel: +44 (0)20
7796 4133
Notes to editors
PPHE Hotel Group Limited is a Guernsey registered company and
through its subsidiaries, jointly controlled entities and
associates, owns, leases, operates, franchises and develops full
service upscale and lifestyle hotels in major gateway cities,
regional centres and select resort destinations, predominantly in
Europe.
The majority of the Group's hotels operate under two distinct
brands, Park Plaza(R) Hotels & Resorts and art'otel(R). The
Group has an exclusive licence from Carlson, a global privately
held hospitality and travel company, to develop and operate Park
Plaza(R) Hotels & Resorts in Europe, the Middle East and
Africa. The art'otel(R) brand is fully owned by the Group.
PPHE Hotel Group has a controlling interest (65.63% of the share
capital) in Arenaturist d.d., one of Croatia's leading hospitality
companies, which is listed on the Official Market of the Zagreb
Stock Exchange.
The portfolio of owned, leased, managed and franchised hotels
comprises 38 hotels in operation offering a total of nearly 8,400
rooms. The development pipeline includes four new hotel projects
and one hotel extension and reconfiguration. These developments are
expected to add over 800 rooms to our portfolio by the end of 2016
and an additional 500 rooms by the end of 2019.
Our Company:
www.pphe.com
Our Hotel Brands:
www.parkplaza.com
www.artotels.com
www.arenaturist.com
For images and logos visit www.vfmii.com/parkplaza
This information is provided by RNS
The company news service from the London Stock Exchange
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