Two of Brighton's best-known hotels could soon be under shared ownership.

Richard Balfour-Lynn, chief executive and co-founder of Hotel Du Vin group Marylebone Warwick Balfour, is understood to be winning the race for control of leisure group De Vere, owner of the famous Grand hotel in Kings Road.

The multi-millionaire is thought to have edged ahead of American hotels operator Starwood and private equity house Permira, who have also been circling the £800 million group.

His bid for De Vere, which operates 19 hotels including the Belfry golf and hotel complex in the West Midlands, is being made through his privately-owned vehicle Alternative Hotels Group.

He is said to have the support of Halifax Bank of Scotland, which worked with him and other investors on the £325 million takeover of East Grinstead-based Rentokil Initial's conference venues business in November.

According to reports, Mr Balfour-Lynn was prepared to offer between 820p and 830p a share, valuing the group at almost £700 million. De Vere is holding out for an offer closer to 850p a share.

Mr Balfour-Lynn formed Warwick Balfour Properties, a property development and investment company, in 1982 before co-founding MWB in 1994.

As well as 15 Malmaison and Hotel Du Vin hotels across the UK, MWB owns the five-star Park Lane Marriott and the Liberty department store at London's Regent Street.

The other bidders in the frame are Permira, which has teamed up with property firm Delancey, and Starwood, which owns the Sheraton and Le Meridien brands. US venture capital group Blackstone is understood to have withdrawn from the auction.

De Vere, which also owns a string of Village leisure hotels, health and fitness brand Greens and gin-maker G&J Greenall, is trying to push the sale forward.

But a game of cat and mouse between its pursuers has developed, with each waiting for a rival to bid first. The Grand, one of the most prestigious hotels in Sussex, has just welcomed its third general manager in two years.

Wednesday, June 20, 2006