Scandic’s Dalata Deal Template Comes for Europe’s Mid-Cap Hotels
Scandic Hotels reported half-year results Wednesday, and the most interesting numbers weren’t the revenue and earnings figures. The more eye-catching numbers concerned Scandic’s acquisition of Dalata Hotel Group and its low debt level.
It expects to pay €500 million (about $545 million) for Dalata, Ireland’s largest hotel company. And its net debt is about as close to zero as a hotel company gets, just 0.1 times earnings.
The Dalata acquisition is worth watching beyond Ireland because of its structure. Dalata was not bought by Scandic. It was taken over in November by a consortium of two property specialists, Sweden’s Pandox and Norway’s Eiendomsspar, which kept the buildings in a $1.6 billion deal.
What’s new: Scandic is agreeing to take the other half: the operations of 56 hotels with roughly 12,000 rooms across Ireland and the U.K., which it is running in the interim under a management contract. A purchase for an expected €500 m
