(Reuters) -Scandinavian property companies Pandox AB and Eiendomsspar AS have agreed to buy Ireland’s largest hotel group Dalata for 1.4 billion euros ($1.64 billion), the companies said on Tuesday.
Dalata, which operates 56 hotels under the four-star Maldron and Clayton brands, mainly in Ireland and the United Kingdom, had rejected an initial bid from Pandox and Eiendomsspar in early June that had valued the hotel operator at 1.3 billion euros.
Sweden-based Pandox, which specialises in the ownership, development and leasing of large hotels across Sweden and northern Europe, will own 91.5% of the entity taking over Dalata, while Norway-based Eiendomsspar will own 8.5%, the companies said in a statement.
Pandox’s long-term operating partner, Scandic Hotels Group AB, will become an operating partner for the existing Dalata portfolio, the statement said.
Dalata CEO Dermot Crowley said the deal was a “very good fit” as it gives Pandox a large portfolio in Britain and Ireland, and Dalata better access to capital and a larger platform to accelerate growth.
Dalata will continue to target new properties in the United Kingdom and Western and Southern Europe, he added.
Pandox CEO Liia Nõu said the portfolio consisted of “well-established and highly profitable four-star hotels in strong locations” that would increase its footprint in key markets.
Under the deal, Dalata shareholders will get 6.45 euros in cash per share, representing a premium of about 12% to the closing price on June 2 – the day before the Scandinavian hotel investors first disclosed their interest in the Irish company.
The latest offer, which has the backing of the board, concludes the Dublin-based company’s strategic review that was launched in March to drive up shareholder returns.
($1 = 0.8558 euros)
(Reporting by Yadarisa Shabong in Bengaluru and Conor Humphries in Dublin; Editing by Mrigank Dhaniwala, Eileen Soreng and Kate Mayberry)
