Raffles draws up shortlist of four hotel companies

Singapore-based Raffles Holdings is close to buying a medium-sized hotel company.

Announcing its financial results for the six months to 30 June, Raffles said: "We have made good progress on our discussions with four parties. We will make further announcements in the near future."

The company is also holding discussions with five parties in Asia and Europe on securing management contracts for their properties.

During the six months, sales in the group's hotels and resorts increased by 13.3% to S$118m (£45m). Pre-tax profit fell by 4.2% to S$27m (£10.3m).

The increase in turnover was the result of improved occupancy levels and room rates in its hotels in Singapore and Cambodia, combined with economic recovery in Asia and improved results at its hotel in Germany.

It was also helped by the opening in December 1999 of the Merchant Court hotel in Sydney, Australia.

The fall in profits was put down to start-up expenses at the Merchant Court and the fact that some of its bedrooms were not ready until April.