TAKEOVER BID FOR DALATA HOTEL GROUP
Dalata is an Irish hotel company that manages around 13,300 rooms, 51.5% of which are located in Ireland, 36.4% in the United Kingdom (excluding London), 7.8% in London and 4.3% in Continental Europe. The company owns 30 hotels, operates 22 under lease and 3 under management.
It focuses on 4-star hotels, with two main brands: Clayton and Maldron. Its future growth vectors, in order of importance, are: Continental Europe, London, the United Kingdom (excluding London) and Ireland. The company plans to increase its current capacity by 60% by 2030.
B)Takeover bid by shareholder Eiendomsspar for Dalata
On 3 June, at the close of trading, it was announced that Eiendomsspar, Dalata’s second largest shareholder with an 8.5% stake, had launched a takeover bid for 100% of the company, in collaboration with an investment consortium. The Swedish company Pandox, which specialises in hotel property investment and in which Eiendomsspar also has a stake, is part of this consortium.
The price offered is €6.05 per share, payable entirely in cash. This price represents a premium of 5.0% over the last trading price (€5.76) and 29.6% over the closing price in December 2024.
C) Our positions in Dalata shares
At the time of the takeover bid announcement, the GVC Gaesco Pareturn Columbus fund held a position in Dalata shares representing 2.76% of the fund’s assets.
D) Our stance on the takeover bid
The offer price of €6.05 per share implies certain valuation multiples that, in our opinion, do not adequately reflect the company’s real value.
Dalata’s Board of Directors has announced that it will study the offer. However, its chairman has indicated that the price offered does not represent an adequate value for the company.
Since the announcement, Dalata’s share price has traded above the offer price, indicating that the market anticipates an improvement in the offer or considers the company to be undervalued.
Our entry price in the GVC Gaesco Columbus European Equities FI fund was €4.00 per share, representing a revaluation of +51.25% at the offer price, without taking into account dividends received.
We will not accept the takeover bid, as we consider that the appropriate valuation range for Dalata is between €7.50 and €8.00 per share.
This transaction represents a solid endorsement of our investment and company selection process and constitutes a significant source of profitability for our investors.
