JJW heads bidders for troubled Choice group

JJW Hotels and Resorts is thought to be the frontrunner in the bid to buy the troubled Choice Hotels Europe group (formerly Friendly Hotels) from its US-based majority shareholder, Choice Hotels.

Owned by a Saudi Arabian businessman, JJW recently paid £51m for the 216-bedroom Berners hotel in London (Caterer, 20 September, page 64).

David Wright, chief operating officer of JJW, would not confirm the bid, but said: "I will confirm our acquisition plans are to grow within Europe and we are already in the two-, three- and four-star markets.

"As a company we are not pessimistic about domestic tourism and intra-European tourism following the New York terrorist attacks. We believe that effect will be short-lived."

Choice has 471 hotels in Europe, including franchisees, and includes 60 owned and operated properties, 45 of them in the UK.

The company holds the master franchise in Europe for US-based Choice Hotels, owner of the Clarion, Comfort, Quality and Sleep Inn brand names.

Last week (1 November) Choice Hotels Europe's share price stood at 20p, a far cry from its five-year high of 179p. The company has been struggling since a profits warning and poor trading in 2000 led to the announcement it would sell a third of its UK hotels. It also secured an agreement with Choice Hotels to waive payment of franchise fees, worth about £6m, for five years.

In June the group denied it had put itself up for sale but admitted it was in discussions with potential buyers and would consider "all appropriate options and proposed offers for the share capital".

Rezidor, Radisson SAS's parent company, is another company believed to have bid. Rezidor's chief executive, Kurt Ritter, acknowledged he was in "advanced discussions to buy a midmarket American-based brand".

by Sara Guild
Source: Caterer & Hotelkeeper magazine, 8-14 November 2001