Hospitality makes R715 million acquisition
Hospitality Property Fund announced on Tuesday 31 August 2010 it had acquired Westin Grand Cape Town and Arabella Western Cape Hotel and Spa for R715.2 million.
The property group also said it intended to raise R490 million through the rights issues to Hospitality A- and B-linked unitholders to partly fund the deal.
In terms of the deal, HPF Properties, Hospitality's subsidiary, will assume about R26 million of working capital liabilities of the Arabella hotels and it will fund up to R251.2 million of the purchase consideration through new debt facilities.
Westin includes the Paulaner Brauhaus restaurant and micro brewery situated on the V&A Waterfront in Cape Town, and Arabella owns hotels.
The proposed deal is subject to regulatory and linked unitholder approval.
Hospitality said the Westin is a landmark five star hotel in the CBD of Cape Town, ideally located adjacent to the Cape Town International Convention Centre.
Arabella Western Cape Hotel and Spa is a five star luxury hotel and award winning golf course, located near Hermanus in the Western Cape that has the potential to add to growth in distributions over time, including through the development of the approximately 437 hectares of undeveloped land, which forms part of the transaction.
"It is expected that the acquisition of the Arabella hotels will provide an additional underpin to the preferential distribution rights of Hospitality A-linked unitholders and contribute to growth in distributions for Hospitality A-and B-linked unitholders," Hospitality said.
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