Leisure firm De Vere has pulled out of the £500 million-plus bidding war for budget hotel chain Premier Lodge amid concerns over the cost of the acquisition.
De Vere, which owns The Grand hotel, Brighton, had made a joint offer for Premier Lodge with investment group Sun Capital. Its withdrawal was announced by chief executive Carl Leaver.
He said: "Our involvement in the auction process for Premier Lodge signifies the ambition of the company while our determination not to overpay signifies our financial discipline."
De Vere used to own Premier Lodge when it was a much smaller operation with 69 sites but sold it to Scottish & Newcastle in 1999.
Premier Lodge has since become the UK's third largest budget hotel brand.
In addition to its portfolio of hotels, De Vere runs 15 health and fitness clubs trading as Greens, 14 village leisure clubs and distillers G&J Greenall.
The group is currently under pressure from a rebel shareholder group to sell its hotels chain. Guinness Peat Group (GPG) recently raised its offer for a 35 per cent stake in De Vere. GPG believes it can make £550 million from selling the upmarket De Vere brand hotels, including The Grand, at a time when the entire company is valued at only £501 million.
Thursday June 03, 2004
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