On 14 June 2008 Hunan Huatian Great Hotel Co. Ltd (000428) announced that a proposal to acquire a 100% stake in Hubei Arc of Triumph Hotel Management Co. Ltd for RMB 295 mln was approved by the board of directors and is subject to the approval of a general meeting of shareholders.

The main assets of Hubei Arc include the hotel's land right use, buildings, parking areas and ancillary equipment and decorations. According to the announcement, of the RMB 295 mln, RMB 100 mln will be paid in cash, RMB 170 mln will be paid by undertaking the bank loan debts of previous shareholders and RMB 25 mln will be paid by undertaking receivable accounts owed by previous shareholders to Hubei Arc.

The five-star Hubei Arc of Triumph Hotel is located in the heart of Xudong business center circle in Wuchang District, Wuhan. The hotel has been under the trustee management of Hunan Huatian since its opening in August 2005 and a mature management relationship has been formed. This acquisition will help Hunan Huatian promote its 'Huatian' hotel brand in Hubei Province and explore the Hubei market.

The acquisition is projected to bring Hunan Huatian RMB 50 mln in operational revenue and RMB 3 mln in property rental income for 2008.


Source: Security Times

Date: 14 Jun 2008

CN01/MZ /AR/WH