31st Mar 2014 10:47
LONDON (Alliance News) - Redefine International PLC Monday said its majority-owned subsidiary, Redefine Hotel Holdings Ltd, has entered a contract to buy up the remaining 40% stake in BNRI Earls Court Ltd for GBP6.3 million.
According to the statement, the deal will be funded by utilising part of the proceeds from the company's February GBP54.7 million share placing. In February, Redefine said the proceeds of the placing will go towards future acquisitions.
"We referred to this potential transaction during our recent successful GBP54.7 million capital raise and are pleased to be making the final steps towards deploying the capital now," Mike Watters, Chief Executive, said in a statement.
"The limited service hotel sector continues to thrive in pockets of London, and this, combined with our in-depth knowledge of the performance of this particular hotel and our ongoing belief in the potential of this sector, supports our confidence that the transaction will deliver a high quality income to our investors," Watters added.
Redefine Hotel, which is 71%-owned by its parent, is buying the stake from Camden Lock and Earls Court LLP.
BNRI owns the 150 bedroom Holiday Inn Express Hotel in Earls Court, London.
Redefine International, which converted into a REIT at the end of 2013, said the purchase price implies that the hotel has a GBP28.1 million value.
The deal is conditional on a proposed refinancing of the entire hotel property portfolio being concluded with the existing lender, which is currently in progress.
The hotel is part of RHH's existing portfolio of seven hotels.
Redefine shares were Monday quoted at 52.75, down 0.9%.
By Samuel Agini; [email protected]; @samuelagini
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