Whitbread to serve up pounds 380m of acquisitions
Monday 07 August 1995
David Lloyd, the former British tennis star, will today announce the sale of his leisure clubs to Whitbread, the brewing and leisure group, for between pounds 170m and pounds 180m.
Whitbread is also expected to announce this week that it is to buy the Marriott chain of hotels in the UK from Canadian owners Scott Hospitality for pounds 200m.
Whitbread, one of the largest brewers and pub operators in the UK, secured an exclusivity agreement on the bid to buy David Lloyd Leisure late last week. It spent the weekend carrying out due diligence inquiries and discussing the crucial role of Mr Lloyd, the chairman, under the new ownership.
A spokesman for DLL said yesterday that the finishing touches were being added to the deal, although confirmation of the bid was not expected until late today or possibly early tomorrow morning. Mr Lloyd personally could make pounds 19m from the deal.
DLL is expected to be run as a stand-alone subsidiary of Whitbread with Mr Lloyd remaining at the helm, although it was still unclear yesterday whether he would receive a seat on the Whitbread board.
An offer of 370p-385p a share is expected although some sources did not rule out a possible 390p-400p. The possibility of such a high price is thought to have ruled out other potential bidders for the leisure clubs such as Rank and First Leisure.
Shares in DLL, which was launched in 1982 and floated in 1993 at 150p, reached another all-time high of 341p on Friday.
DLL owns 13 sites and is due to add another two this year, including a Cardiff club on a 13.2-acre site bought from Whitbread in January 1995. Investment by Whitbread would increase the profits analysts have pencilled in for DLL of pounds 9m in 1995 and pounds 11.5m in 1996.
Whitbread's offer for the Marriott hotels will almost double the group's hotel capacity. It already manages about 3,800 rooms in 101 hotels and the deal will bring in 3,500 more as well as access to the worldwide Marriott booking system.
The group is expected to re-brand its own Country Club hotels as Marriotts.
Whitbread can afford to move in at the higher end of the scale. The group has less than pounds 100m of debt on shareholders' funds of more than pounds 2bn. The acquisition of DLL will make the group top seed in the up-market leisure club sector - it already has health clubs in the Country Club resort hotels.
Whitbread's chief executive, Peter Jarvis, will be relieved to have beaten rivals to the prize of DLL.
The brewer's attempts to expand have been less than convincing of late as it failed to buy the Courage brewing business, Harvester restaurants and the Chef & Brewer pub chains. Each time it walked away because the price was too high.
Whitbread's non-brewing assets include such restaurants as Beefeater, TGI Friday's, Brewer's Fayre and Pizza Hut as well as the budget hotel chain Travel Inn. In 1994 it spent pounds 282m on its non-brewing businesses.
Children's bookseller wins The Independent's new author search
Board creates magnetic field to achieve lift
- 1 Jack the Ripper: Scientist who claims to have identified notorious killer has 'made serious DNA error'
- 2 Banksy arrest hoax: Internet duped by fake online report claiming artist's identity has been revealed
- 3 Former East 17 frontman Brian Harvey turns up at Downing Street and 'demands to speak to Prime Minister'
- 4 Kentucky gang rape: 15-year-old boy left in critical condition after sexual attack by group at party
- 5 Paralysed man Darek Fidyka walks again after treatment by British doctors on brink of 'cure'
Jack the Ripper: Scientist who claims to have identified notorious killer has 'made serious DNA error'
Oscar de la Renta dead: Legendary US fashion designer dies after long cancer battle aged 82
Oscar Pistorius: The brutal prison life that awaits disgraced athlete
Banksy arrest hoax: Internet duped by fake online report claiming artist's identity has been revealed
Super-sized ships arrive in Britain: How big can they get?
Cameron is warned 'no possibility' of UK reducing immigration and that bid to bring in quota on migrant workers would be illegal
Residents should throw a street party and mix with immigrant neighbours, councils told
Russell Brand threatened with arrest after filming outside Fox News headquarters
London bus driver 'kicks gay couple off for kissing'
Lord Freud: Tory welfare minister apologises after saying disabled people are 'not worth’ the minimum wage
Lord Freud hangs on as MPs of all parties 'call for his head' over disability comments
iJobs Money & Business
£23000 per annum + pension and 22 days holiday: Ashdown Group: An established ...
£27000 per annum + pension, 22 days holiday: Ashdown Group: An established ind...
£23000 - £26000 Per Annum: Clearwater People Solutions Ltd: Our client is curr...
£25 - 30k: Guru Careers: A Corporate Actions Administrator / Operations Admini...