Orascom Development sells 2 hotels, land plot for LE 856M
The company clarified in a filing to the Egyptian Exchange (EGX) that it concluded the sale of Royal Azur and Club Azur Hotels as well as a land plot in the Makadi destination on the Red Sea.
“The sale was concluded at a higher enterprise value of c. LE 856 million than the LE 823 million that was previously announced. This will result in total cash proceeds of c. EGP 408 million ($ 22.8 million), compared to the c. LE 387.1 million ($21.6 million) that was previously announced,” the company stated.
The statement added that the sale will also result in the deconsolidation of LE 260.1 million of debt held on Royal for Touristic and Development Company, the former owner of the hotels.
“We are also in the course of finalizing the documents for the completion of the sale of the Makadi Gardens Hotel which was sold for LE 114.7 million ($ 6.4 million),” the statement read.
“The conclusion of the sale is a solid testament to our continuous delivery of our strategy. Since the beginning of year, the company has made significant strides to streamline and reshape its investments through monetizing its non-core assets,” Chief Executive Officer Khaled Bichara said.
“We will continue to wisely invest our capital to drive growth and prioritize our time and resources to build a stronger and sustainable organization,” he added.
The company noted that the proceeds of the sale of the hotels and the land spot, in addition to those of the Tamweel Group together with parts of the excess cash flow from operations, will all be geared towards reducing the debt balance.
Previously, Orascom Development announced that its hotel subsidiary Orascom Hotels Management (OHM) signed an agreement with Thomas Cook with total investments of LE 200 million.
CAIRO - 19 December 2018: Orascom Development Egypt (ODE) announced that its hotel subsidiary Orascom Hotels Management (OHM) signed an agreement with Thomas Cook with a total investments of LE 200 million. Orascom clarified that the agreement includes developing a new 100-room luxury beachfront hotel property under the brand of Casa Cook El Gouna, and rebranding Arena Inn, El Gouna's 144-room downtown hotel, to become Cook's Club Hotel.
In December, Orascom Development announced signing the final agreement with the New Urban Communities Authorities (NUCA) to co-develop a 1,000 feddan integrated community project in 6th of October City, West Cairo, based on a revenue sharing model.
Orascom Development Egypt operates within the consumer services sector focusing on hotels, resorts and cruise lines with 52 subsidiaries operating across Northern Africa, Middle East and southern Europe.