Orascom Development Egypt, a subsidiary of Switzerland's Orascom Development Holding, has sold its stake in the Royal Azur and Club Azur Hotels as well as a land plot in the Makadi area on the Red Sea to Meeting Point International for cash proceeds of EGP 408 million.
“The sale was concluded at a higher enterprise value of c. EGP 856 million than the EGP 823 million that was previously announced. This will result in total cash proceeds of c. EGP 408 million ($22.8 million), compared to the c. EGP 387.1 million ($21.6 million) that was previously announced,” the company said in a statement to the Egyptian Exchange. It added the sale also will result in the deconsolidation of EGP 260.1 million of debt held on Royal for Touristic and Development Company, the former owner of the hotels.
“We are also in the course of finalizing the documents for the completion of the sale of the Makadi Gardens Hotel, which was sold for EGP 114.7 million ($ 6.4 million),” the statement read.
Since the beginning of the year, the company has been looking to streamline and reshape its investments through monetizing its non-core assets, said CEO Khaled Bichara. “We will continue to wisely invest our capital to drive growth and prioritize our time and resources to build a stronger and sustainable organization.”
The company noted the proceeds from the sale of the hotels and the land will be applied toward reducing the debt balance.
Earlier this month, Thomas Cook announced a partnership with Orascom Development Holding to open two proprietary hotels in El Gouna, Egypt, next year. The company will open a 100-room waterfront Casa Cook hotel as well as a Cook’s Club hotel in the Red Sea resort town.