JULIUS BAUMANN

Aviation and Tourism Editor

A CONSORTIUM including Protea Hotels management, its black economic empowerment shareholders and Investec Private Equity has bought back the 74% stake the hotel group sold to Australian-based Stella Hospitality Group two years ago.

Protea Hotels group MD Arthur Gillis would not be drawn of the purchase price yesterday but it is believed to be far below the R1,48bn Stella paid for the stake in July 2007. “They were willing sellers and we were willing buyers,” said Gillis.

Stella acquired the stake in Protea Hotels as it attempted to expand its global reach, a strategy that appears to have collapsed.

The inclusion of Investec Private Equity may be surprising but Gillis said that Investec CEO Stephen Koseff had long eyed a stake in the hotel group.

“Stephen has for many years wanted to get involved in the business and when this opportunity came up I did a presentation to Investec and eventually they formed part of the consortium.”

Gillis confirmed that Protea Hotels, as always, remained firmly focused on SA and Africa. “Even under Stella our focus was on SA and the continent and that remains our strategy.”

The deal still requires Competition Commission approval and the final shareholding of the various consortium members is still to be finalised. However, Gillis said the stake held by Protea’s empowerment partners would increase substantially from its current 26% once the transaction was finalised.

Themba Matsane, spokesman for the empowerment consortium, said yesterday: “We have been a part of Protea Hotels and their growth for the past decade, and in sharing their belief in the potential of the country, the continent and the company we enthusiastically look forward to the future,”

The consortium includes the Police and Prisons Civil Rights Union, the National Allied Workers’ Union and the Food and Allied Workers’ Union, as well as AKA Capital, Prime Portfolio Investments and Hoyohoyo.

The group had six hotels under construction. These include two Cape Town properties — the 15 On Orange Hotel and Crystal Towers Hotel — and the Protea Hotel Ikoyi Westwood in Lagos, Nigeria, due to open in June.

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Source: Business Day