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Revenue backing boosts Exclusive sale

Granada wins hotel approval but loses interest in race classic
Granada has secured crucial Inland Revenue approval for the corporate structure of the Exclusive hotels chain which it put up for sale following the Forte takeover earlier this year.

Approval is important since it gives Granada far more flexibility over the disposal. It can now either sell the chain as a single entity or as individual properties and still receive similar capital gains tax treatment.

Bidding for the hotels has now moved into the second round which involves only serious prospective buyers.

"We are now at the stage where people are going around doing structural surveys," one source said.

Granada would make no comment on the number of bidders but it is understood that there is interest both in the entire chain and individual properties.

The final details of the sale should be concluded towards the end of the year but Granada does not expect to make a formal announcement until January.

The auction process along with the improved outlook for the hotel industry, particularly in London, has helped the valuation of the portfolio.

However, it is thought that the original book value attributed to the hotels of around pounds 1bn is still the most realistic sum that Granada will secure.

Granada has resisted any temptation to hang on to the Exclusive chain, which includes such hotels as the Grosvenor in London, the George V in Paris and the Sandy Lane in Barbados.