pounds 250m float for Jarvis Hotels

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The Independent Online
Jarvis Hotels, a 62 strong mid-market chain, is planning a June flotation which will value the six-year-old group at between pounds 250m and pounds 280m. Unlike the recent market debuts of rival chains Millennium & Copthorne and Macdonald, Jarvis shares will be available to the public through an intermediaries offer as well as the usual placing of shares with institutions.

About half Jarvis's shares are to be sold, providing an exit for venture capital groups that backed the original acquisition of 41 Embassy Hotels from Allied Breweries in 1990. Since then, Jarvis has also acquired 20 hotels from Resort Hotels.

Management of Jarvis, led by John Jarvis, a former chairman and chief executive of Ladbroke's Hilton International chain, and David Thomas, another former Ladbroke employee, will hold just under 3 per cent of the shares following the float, valuing their holding at about pounds 7.5m.

The flotation of Jarvis confirms the current appetite in the City for hotel businesses, which are riding a boom in the market, characterised by higher occupancy levels and rising room rates. Thanks to its regional bias and shortage of London sites, Jarvis boasts occupancy of about 67 per cent, less than that enjoyed by companies with a bigger presence in the capital but, according to a recent industry survey, better than average in the provinces.

Jarvis has tried to differentiate itself from the competition with innovations designed to give it a "personality". Initiatives have included fitness equipment delivered to your room, pre-threaded needles in each room's sewing kit, and even free use of Nintendo Game Boy machines.

In the six years since the buoyout from Allied, Jarvis has increased profits each year, notching up a compound growth rate of 22 per cent a year.

Private investors interested in the issue can register either through their own broker or through one of the following intermediaries: City Deal Services, Hargreaves Lansdown, ShareLink, The Share Centre, Skipton Building Society and YorkShare.