Leisure giants Whitbread and Mitchells & Butlers have agreed a £78m property swap that will give Whitbread 21 Express by Holiday Inn hotels and M&B 44 pub restaurants.
The exchange has been made on the basis of equivalent EBITDA of around £9m from the hotels and pub restaurants.
M&B said it planned to conduct a sale-and-leaseback of the 44 pub restaurants it acquired via the exchange “to assist in funding the capital expenditure required for the conversions and to further reduce group debt levels”.
The 44 Whitbread pub restaurants to be exchanged are on sites where development with a Premier Inn has not been possible because of planning constraints.
Whitbread said its acquired hotels would take the total number of UK Premier Inn bedrooms to more 38,000 in 550 hotels. Planning consent has been granted to extend five of the 21 acquired hotels, adding around 200 new bedrooms.
Whitbread chief executive Alan Parker said: “There is a clear and compelling logic to this transaction. Acquiring this well located, modern hotel estate will enable us to re-brand quickly, drive occupancy, increase profits and extend the number of rooms at these hotels by at least 20%.”
Completion of the deal is scheduled for 19 September.
