But investors who took up the discounted rights issue to fund the deal must so far be pleased. Against the 465p rights price, shares in the hotel group continued their good run up to 623.5p in June, though they have come off the boil since then. The question now is whether there is any more left in the tank.
The half year figures, which showed pre-tax profits from continuing operations up 10 per cent to pounds 26.8m, were in line with expectations. The regional picture was mixed, however.
The UK performance was worse than some analysts' forecasts, with revenue per available room in the five London hotels down by 2 per cent, and by almost 4 per cent in the provinces. Whilst forward bookings are stronger, there has been a blip in demand. The strategy has been to trade some loss of occupancy for higher room rates that attract bigger-spending, higher- margin guests.
Offsetting the weak domestic scene, there was strong growth overseas, particularly in Europe and New York. It is Asia, however, that holds the key and the investment case for the shares now is a punt on Far Eastern recovery. M&C is looking for more acquisitions in the region, with Bangkok, Tokyo and Seoul the primary hunting ground. Melbourne and Boston are also being scoped out.
M&C is tightly run and Kwek Leng Beng, chairman, is highly regarded. But on analysts' forecasts of pounds 95m pre-tax profits this year, the shares - up 12p to 521.5p - trade on a premium to the sector with a forward p/e of 18. They are expensive.