TUAN Sing Holdings will delay checking out of the Australian hotel market if the price is not right and the company has given itself plenty of time.
Earlier this week the company convened an Extraordinary General Meeting for shareholders to vote on the resolution to dispose of the Grand Hotel Group assets.
And shareholders have given the company the go-ahead to proceed with proposed disposal.
Tuan Sing said by obtaining shareholders’ approval to dispose of the hotel properties, the company will be able to seize opportunities to realise attractive returns.
When the company first announced its intentions to sell the GHG assets in April this year, it was widely reported that Tuan Sing was looking to make a quick buck from its investment.
In early last year, a Tuan Sing and Morgan Stanley joint venture bought out GHG for $350 million. As at December 31, 2007 – the GHG portfolio of four hotels earmarked for sale was valued at $615.8 million – almost twice the value the JV paid for GHG and $60 million above GHG’s November 2006 valuation of $550 million.
Earlier this month, Tuan Sing said no buyers have emerged since the company announced its intention to sell.
“No buyers have been identified and no sales prices have been offered for any and all of the hotel properties,”
So this week at the EGM, the company indicated that it was not desperate to sell and will wait for right price.
Tuan Sing announced that is has given itself until June 30 2010 to sell the assets.
The company said the sale will be on terms the directors deem fit.
“Provided always that the sales price is not less than the Net Asset Value as reported in the latest financial statements of GHG where such NAV is based on the latest valuation as last reported by an independent professional valuer,”
In addition, Tuan Sing said the valuer’s report should not be more than 12 months old at the time of the directors’ decision to sell the four hotel properties, which are the Hyatt Regency Adelaide; Park Hyatt Canberra; Grand Hyatt Melbourne; and its 50% stake in Hyatt Regency Perth.
The hotel properties are currently valued at $615.8 million as at December 31 2007 and the prized asset in the portfolio is the Grand Hyatt Melbourne, last valued at $210 million in November 2006.
“The proceeds from the proposed disposal, if it comes to fruition, will enhance the company’s balance sheets and enable the company to be better positioned to seize new investment opportunities as and when arise,” Tuan Sing concluded.
Australian Property Journal
