The Grand Hotel Group (GHG) in Canberra, Australia, which is 50%-owned by Tuan Sing Holdings, is selling for S$79.5 million (A$80 million) – a near 14% premium to its book value.
Tuan Sing announced yesterday that GHG, together with two other GHG subsidiaries, obtained a put-and-call selection deed to sell the Park Hyatt Canberra to a buyer. They gave no other details of the buyer except for its name – Tropical Almond Development. The transaction, on the other hand, is not expected to be completed before the end of the year, according to Tuan Sing.
Park Hyatt Hotel in Canberra, Australia is a five-star hotel developed in 1924. It has 249 guest rooms and stretches on a land area of 29,990 square metres.
The sale price was more than GHG’s estimated book value of A$70.3 million. Park Hyatt Canberra thus, is A$9.7 million more. Jones Lang LaSalle Hotels, a professional valuer gave its support to the book value.
The reason why GHG had to sell was because they needed to cut down its bank loans through the bulk of the proceeds, according to Tuan Sing.
Tuan Sing’s Q3 financial statement indicated that their total debt rose 41% as of Sept 30 this year. On the contrary, they have reported a 94% drop in the third-quarter net profit. According to them, GHG is to blame for its share of an exceptional loss.
The GHG property accounts for 9% of the group’s net asset value of about $437.2 million as of September 30 this year. Also, GHG accounts for 6% of the group’s nine-month net profit of $24.4 million.