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Jarvis Hotels in refinancing talks over £122m debt

16 March 2010 by
Jarvis Hotels in refinancing talks over £122m debt

Jarvis Hotels, which operates 42 and five associates properties hotels under the Ramada franchise, is believed to be in talks with its banks regarding the refinancing of its £122m debt.

It was reported in the Times that a debt-for-equity swap or property sales are the likely result of a cashflow crisis at Jarvis.

The four-star hotel group, which is in breach of banking convenants, has been late in filing its accounts for the year ending March 2009 at Companies House. Its auditors, KPMG said in its previous accounts that there was "a material uncertainty which may cast doubt on the group's ability to continue as a going concern."

Jarvis Hotels employs around 4,000 staff in its hotels throughout the UK. The company was founded in 1990 when John Jarvis, former chairman and chief executive of Hilton International, purchased 41 hotels from Allied Lyons which, at the time, was the largest ever management buy-in.

In 1996, the group was floated on the London Stock Exchange with a market value of £300m and in 2001 Ramada International Hotels & Resorts reached a franchise agreement with Jarvis involving 55 hotels..

The company was taken private in 2004 with financial backing from investors Kayterm and venture capitalists Lioncourt. Since then Jarvis has streamlined its business, offloading 15 of its properties and refurbishing its remaining hotels.

Jarvis Hotels declined to comment.

Jarvis Hotels bosses in bid to go private >>

Jarvis hotels will fly Ramada flag >>

Jarvis Hotels for sale at £200m >>

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