Irish budget hotel chain Jurys Inn has completed a financial restructuring that has resulted in its lenders taking a write-down on loans of about £300 million (€351 million).
Under the terms of the deal, additional investors have been brought on board with new equity of £120 million involved.
It is understood the new equity will be paid to the lenders – Irish Bank Resolution Corporation, AIB and Ulster Bank – with a debt-for-equity swap in the transaction.
The debts of Jurys Inn are believed to have been reduced from about £650 million to about £240 million. It was not clear last night precisely what haircut each lender has taken on the loans. No comment was available from any of the banks involved. The banking facilities will run for five years.
Shareholder make-up
Jurys Inn shareholders now comprise the Oman Investment Fund; US-based investment group Mount Kellett Capital Management LP in partnership with Dublin-based Avestus Capital Partners; Ulster Bank; and Westmont Hospitality Group, one of North America's biggest privately owned specialist hotel investors.
Jurys Inn was acquired from Irish hotel group Jurys Doyle in 2007 for €1.166 billion by a consortium of investors led by Quinlan Private, then headed by Derek Quinlan. Mount Kellett, Ulster Bank and Westmont Hospitality are new shareholders.
Avestus is an investment vehicle established by senior executives from Quinlan Private. Mr Quinlan is not involved.
The Oman Investment Fund became a shareholder in 2008 via a reported €200 million investment and remains the biggest shareholder.
Jurys Inn said yesterday that the revised balance sheet structure would allow it to “build on its strong operating performance, which has seen profit as well as revenues grow each year over the past three years”.
A spokesman for Jurys Inn said the company’s 2011 accounts would be filed shortly and would show that revenues rose by 6 per cent to £147.5 million while its earnings before interest, tax, depreciation and amortisation increased by 4 per cent to £33.4 million.
He said “further growth” in revenues and profits was recorded by the company in 2012.
Jurys Inn employs 2,000 staff and operates 24 hotels in the UK, seven in Ireland, and one in Prague. This is some way short of the 48 hotels by 2012 that the company had planned at the time of the original deal.
'Great news'
John Brennan, chief executive of Jurys Inn Hotel Group, said the restructuring was "great news" for the business.
“We are especially delighted to have attracted such a prestigious group of long-term, well-capitalised, institutional investors with global experience in the hospitality sector.”
The restructuring is subject to Competition Authority approval in Ireland.
