Trafalgar hotels attract 20 buyers
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Your support makes all the difference.TRAFALGAR HOUSE has received 20 expressions of interest in its three London hotels, the Ritz, the Stafford and Dukes, and believes at least six overseas investors are seriously interested.
The company hopes to raise more than the pounds 130m book value of the hotels, but says it has not set a deadline on the sale. Its immediate concern is to dissuade its shareholders from accepting an 85p-a-share tender offer from Hongkong Land, which wants to increase its stake to 29.9 per cent.
Hongkong Land bought 14.9 per cent of Trafalgar House's shares on Thursday, but under takeover rules has to make a general offer to increase its stake further: this runs out on Friday.
Trafalgar House's directors and bankers spent the weekend drawing up a defence document, which will be issued tomorrow. The document is understood to be unlikely to contain hard figures, but will point out that analysts have valued the break-up value of the group at 150p a share.
The document will have to overcome doubts about the group's accounting procedures, after news that it has been under investigation by the Department of Trade and Industry's Financial Reporting and Review Panel, which monitors over-creative accounting.
The panel, which is expected to make a statement today or tomorrow, has been looking at Trafalgar House's decision in its 1991 accounts to write down assets by pounds 102m on its balance sheet, rather than subtracting the figure from its profit-and-loss account.
Trafalgar House has been under pressure since its pounds 310m rights issue a year ago. Its purchase of Davy, the engineering group, brought with it problems over an uncompleted oil rig conversion contract, and its construction divisions have been hit by the recession. The company hopes that a wealthy individual, probably from the Far East, will be prepared to pay a good price for its prestigious properties.
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