Ladbroke deal with US Hilton tipped

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The Independent Online
TOM STEVENSON

City Editor

A deal between Ladbroke's Hilton Hotels arm and the Hilton Hotels Corporation in the US looked increasingly likely last night after comments from Stephen Bollenbach, new head of the American operation, to a high level industry conference.

Mr Bollenbach is reported to have said that he believed Hilton Corporation had "an underleveraged balance sheet". He confirmed that he was in discussions with Ladbroke on the subject of putting the two businesses together in some form and said he would like to see co-operation between the two.

Speculation that a deal might be close was fuelled by further remarks from Mr Bollenbach that he was keen to expand Hilton Corporation both inside and outside the US. He added that he felt the cost of debt in America was relatively cheap at the moment. News of Mr Bollenbach's comments to a group of 70 large institutional investors, as well as representatives of hotel chains including Intercontinental and Marriott, emerged as Kleinwort Benson, which organised the conference, issued its annual review of quoted hotel companies.

Kleinwort analysts Paul Slattery and Greg Feehely said they expected 1996 to be another strong year for the hotel industry in the UK.

During 1995, while occupancy levels grew in line with expectations, room nights sold increased by 3.7 per cent to 31.35 million, the highest level since Kleinwort's records began.

Separately, Mr Slattery said Sir Rocco Forte, chairman of Forte until its takeover by Granada, remained a strong contender to buy back significant hotel assets from Granada.

Investment column, page 24

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