Fattal confirms takeover bid for PPHE Hotel, in talks for firm offer

(Alliance News) - Fattal Hotel Group Ltd on Thursday confirmed it has proposed to acquire PPHE Hotel Group PLC, and said it is in talks with the PPHE board with the aim of making a firm offer within the next four weeks.

Fattal is a Tel Aviv-based hospitality chain which operates hotels under the Leonardo and NYX brands. It already had an around 4% stake in PPHE, the Guernsey-registered operator of Park Plaza and art'otel hotels, with a property portfolio valued at GBP2.2 billion.

PPHE on Wednesday disclosed that it had received an offer of GBP22 per share from Fattal that values PPHE at GBP930 million in total. Based on PPHE's 41.9 million shares in issue as of Thursday, an offer of GBP22 per share is worth roughly GBP920.9 million.

PPHE shares jumped 24% to 2,006.48 pence per share on Thursday morning in London, giving it a market capitalisation of GBP840.7 million.

The offer is around 47% higher than PPHE's closing share price of 1,500p at November 13, before it launched a strategic review and formal sale process.

Back at that time, PPHE said options could include selling some or all of the company or introducing new growth capital into the company or its hotel portfolio. It noted that 44% shareholders Eli Papouchado and Boris Ivesha supported the review.

PPHE on Wednesday said it believes Fattal's offer represents "fair value", and that it intends to engage with major shareholders to assess the proposal, though it stressed that no firm offer had been made. It also said that the UK Takeover Panel had exempted Fattal from the usual 28-day deadline under the Takeover Code.

To consider the bid, PPHE has set up an independent offer committee excluding Roni Hirsch, the representative director of PPHE's 29% shareholder Euro Plaza Holdings.

On Thursday, Fattal noted that it is willing to maintain the proposal to allow for "constructive engagement" with the PPHE board, with a view towards announcing a firm offer within the next four weeks.

By Holly Munks, Alliance News reporter

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