not vested
Rowsley planning acquisition of hotel management firm Ariva for $10.6 mil
By PC Lee
SINGAPORE (Sept 7): Rowsley, the company controlled by Singapore businessman Peter Lim, is planning to acquire hotel management and consultancy firm, Ariva to expand its hospitality business in the Asia Pacific region for a consideration of $10.6 million.
Ariva manages hotels and service apartments under its own and associate companies’ brands namely Ariva, Amar and Louis Kienne as well as third-party brands.
The company currently has more than 6,500 room keys under management and in the pipeline, spread over 47 properties across the Asia Pacific region.
Ariva was founded in 2008 by Cameron Ong, formerly CEO and MD of Capitaland’s The Ascott Group, and Jean-Claude Erne, formerly Senior Vice President, Product, Process and Procurement at the same group.
Rowsley signed a conditional sale and purchase agreement with the vendors, Ong, Erne and Phyllis Lee Sok Fang, to buy the entire issued and paid-up share capital of Ariva.
Payment will be by way of cash and the allotment and issuance of new Rowsley shares at an issue price of 15 cents each, 25% higher than its Wednesday closing price of 12 cents.
The final purchase price is subject to terms and conditions set out in the sale and purchase agreement which includes the achievement of cumulative net profit after tax target of $5.2 million up till Dec 2019.
As part of the deal, Ong and Erne will continue to lead and grow Ariva as Executive Chairman and Executive Director respectively, after the acquisition.
The Ariva acquisition is financially profitable and its contribution to the Rowsley Group is expected to increase over time as Ariva’s assets under management grows.
In its filing on Wednesday night, Rowsley said: “We are delighted that we are able to attract veterans like Cameron and Jean-Claude, who together have more than 60 years of hospitality experience, to join Rowsley. They have a proven track record in value creation, expertise in turning around distressed assets and making strategic investments. These skills will be invaluable for the expansion of the Group’s hospitality business in Asia.”
Rowsley marked its foray into hospitality in late 2015 with three acquisitions in the UK. It acquired 75% interests in Hotel Football, Café Football as well as GG Collections, a hospitality company.
It also announced the proposed acquisition of a 50% stake in Finestday, the company that owns the Stock Exchange Hotel in Manchester. The Manchester hotels will have a total of 168 room keys with 134 rooms currently in operation under Hotel Football.
Source: The Edge
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