Announcement to ASX re Sale of All Seasons Hotel Management Business

Announcement to ASX re Sale of All Seasons Hotel Management Business

21-Dec-1999

The Joint Chairman of Thakral Holdings Limited, Mr Ted Harris, today announced that Thakral had reached an agreement with ACCOR Asia Pacific involving the sale of its All Seasons hotel management interests for $29 million cash.

The agreement is subject to final documentation and government approvals.

The arrangement involves the sale of the All Seasons Hotel management business which presently manages 27 hotels including five owned by Thakral and the extension of current management contracts between All Seasons and ACCOR for a period of 15 years in relation to those hotels owned by Thakral.

The arrangement entitles Thakral to dispose of hotels managed by ACCOR with vacant possession subject to the refund of part of the sale consideration. The amount liable to be refunded is capped at $14 million which will diminish in equal amounts over eight years. If no hotels are sold in this period the full $14 million will be brought to account as profit at the rate of $1.75 million per annum.

In addition the hotel management agreements provide for termination fees.

All Seasons Hotels was acquired by Thakral for $3 million in 1994. The Group intends to bring the $15 million component to account in the year ending 30 June 2000. After costs and expenses, including provision for rebranding, this should result in an abnormal profit of approximately $10 million.

Mr Harris said: "The agreement with ACCOR concludes negotiations that have been carried out by Thakral management with a number of parties over the last six months, all of whom had expressed interest in the acquisition of All Seasons."

The negotiations commenced following a decision, in principle, taken by the Board to exit the hotel management business subject to negotiating a satisfactory sale price.

The Board believes the arrangements negotiated by management with ACCOR, generating a healthy profit whilst ensuring ongoing professional management of the Thakral hotel properties subject to the agreement, is in the best interest of the Group and in line with the Board's policy of regularly examining the assets of the Group to determine their place and value in the overall portfolio.

For further information please contact John Schaap Managing Director on 9272 8766 or 0417 217632.

Please provide us with your confirmation of release announcement.

Yours faithfully,



Andrew Horne
Group Company Secretary

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