Forte in talks on Air France hotel chain

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The Independent Online
FORTE is in talks with Air France over the purchase of the ailing airline's Meridien hotel chain. No financial details have been released, but Meridien is understood to be worth more than pounds 200m.

Groupe Accor, the French tourism and catering company, has already tabled an undisclosed bid for a 56 per cent stake in Meridien, which has 58 hotels around the world.

It would merge Meridien, which has 17,000 rooms, with its four-star Sofitel hotel chain, with 18,000 rooms.

Ladbroke, the UK company that controls Hilton International, is also tipped by industry observers as a possible bidder.

Christian Blanc, chairman of Air France, said yesterday that the hotels would be sold 'to the highest bidder before the summer'. Air France is selling non-core activities to bolster its finances, which analysts expect to have been severely hit last year by losses of Fr5.5bn ( pounds 640m).

Forte's acquisitive aspirations were dented last month when it was beaten at the eleventh hour by a pounds 375m bid from Sheraton to buy Ciga, the Italian chain owned by the Aga Khan.

That price dwarfed the pounds 270m joint offer made by Forte and George Soros, the financier.

News about Forte's latest target came after the stock market closed. Forte's shares finished the day 9p lower at 255p.

A purchase by Forte of hotels overseas would come at a time when the UK industry is showing its first signs of recovery, particularly in the provinces. However, the pick-up in London is lagging behind - only three months in 1993 saw occupancy levels exceed the depressed numbers recorded in the previous year.

Geoff Parkinson, director of Horwath Consulting, said yesterday: 'The first indications are that 1994 will begin to show an improvement in occupancies.'

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