Published on 09/12/2015 in Asset Sales
Alpha Bank plans to sell the Hilton Hotel Athens
According to media reports, Alpha Bank has reinitiated the sales process of the Hilton Hotel Athens, its most important hotel asset.
The Hilton Athens is owned by Alpha Bank’s subsidiary "Ionian Hotel Enterprises”, founded in 1957 and listed on the Athens Stock Exchange since 1988. It was the first Greek hotel to join an international chain and is considered a flagship enterprise of Greek tourism.
The Athens Hilton underwent an extensive investment programme completed in the first quarter of 2004, shortly before the Olympic Games in Athens. Part of the investment went into the construction of a new wing with 84 rooms, increasing the hotel’s capacity to 506 rooms and suites.
Market executives note that the bank commissioned Citigroup to investigate interested buyers. Notably, large private equity funds expressed initial interest in the hotel. In 2014, Oaktree Capital and Jermyn Street Real Estate Fund were interested in the hotel’s acquisitions for a sales price of €180 million, according to Bloomberg. A deal involving Greek-American businessman John Catsimatidis were also published. However, the deal was never completed.
In connection with the Greek banks’ accelerated effort to dispose assets, the sale is now viewed to be more likely in the near future.
More recent press reports mention Blackstone and Fosun as serious bidders. According to press, Blackstone has bid for a price of € 160 - 170 million.
Ionian Hotel Enterprises currently shows an improved financial performance with a turnover reaching € 23.1 million in the first nine month of 2015 compared to € 22.3 million during the same period in 2014. Earnings before interest, taxes, depreciation and amortization amounted to € 5.4 million versus € 5 million last year while profit after tax has increased from € 400,000 to € 2.3 million.
Despite Greece's financial crisis, the Greek tourism sector continues to grow, generating € 40 billion in total demand according to the Greek Tourism Organisation (SETE). Data published by the Bank of Greece noted 10.6% more tourist arrivals in Greece in the first 8 months of 2015 compared to the same period in 2014 and a 7.1% increase in visitor spending.
SETE expects 2015 to be a record year for tourism with 26 million visitors and an income of €14.5 billion, while noting that privatisation of key tourist and transport state assets as another key investment opportunity.
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