Orient-Express Hotels Ltd. (NYSE:OEH), the owner of 39 deluxe hotel, restaurant, tourist train and river cruise properties in 17 countries, has sold the Hotel Quinta do Lago in Portugal for $40 million – 16 times current year EBITDA. The company also announced it has filed a registration statement for a proposed offering of 3,000,000 class A common shares, with an additional 450,000 shares available to cover an over-allotment option. Merrill Lynch is acting as sole book-running manager for the proposed offering.
James B Sherwood, chairman, said that the primary purpose of the hotel sale and sale of common shares is to raise additional capital for purchase of hotels and related businesses and to fund capital investment in some existing owned properties.
The Hotel Quinta do Lago sale was considered appropriate in that this property lacked its own golf course while intensive development of small homes in the area has put enormous pressure on the nearby golf courses for start times. Another luxury hotel with its own golf course is currently under construction on the same estate. A significant gain on sale of the hotel will be realized and be included in fourth quarter results.
Simon Sherwood, president, said that the company has a number of interesting investment opportunities which are under negotiation and also wishes to fund an annex building for its Windsor Court Hotel in New Orleans and a large spa at Reid’s Palace Hotel in Madeira. In order to complete these investments without straining equity to debt ratios the board has deemed it prudent to raise a moderate amount of additional capital. The company currently has 30.8 million shares outstanding so the sale of 3 million additional shares would increase the shares outstanding by 10%.
The company will announce its third quarter and nine months results on 12th November 2003 and will hold a conference call at 10.00 a.m. (EST). Anyone wishing to join the call should dial 212 896 6111 at that time (phone lines will open at 9.50 a.m.).
For further information contact William W. Galvin, Int. +1-203-618-9800 or Patricia Harper of Orient-Express Hotels Inc. Int. +1-212-302-5055
Orient-Express Hotels www.orient-express.com
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