Macdonald Hotels has sold Rusacks hotel in St Andrews and the leasehold interest of the Randolph hotel in Oxford to Chicago-based AJ Capital Partners for an undisclosed sum.
Earlier this year the group had announced plans to sell 27 properties in a deal that would have wiped out £190m of debt, but The Caterer revealed earlier this month that it had abandoned the proposal in favour of the offloading of just two hotels.
Announcing the completion of the new deal today, deputy chairman Gordon Fraser said: "This is a superb deal for the business, which allows us to reduce our borrowings significantly while we progress a number of very positive options for the refinancing of the group."
In January this year it was announced that the group was making around 50 staff redundant due to "unsustainably high costs". It said difficulties experienced by the businesses as a result of an "above inflation" rise in business rates, alongside the rising costs of minimum wage rates, energy bills, the apprenticeship levy and pension contributions, were highlighted in a letter to staff.
In the most recent accounts for Macdonald Hotels lodged at Companies House for the year to 29 March 2019 the company recorded a pre-tax loss of £1.1m while turnover dropped by £1m year-on-year to £153.2m.
AJ Capital Partners has said the 70-bedroom Rusacks hotel will undergo a complete renovation, commencing in Spring 2020, adding 44 further rooms as well as a rooftop bar and restaurant overlooking the 18th hole of the famous golf course.
Ben Weprin, CEO and founder, said: "St Andrews is one of the most iconic destinations in the world, and our team is honoured to embark upon bringing our unique approach to hospitality to this incredibly historic and inspiring community. We look forward to creating an experience for both guests and locals alike that celebrates and commemorates St Andrews' storied past for years to come."
The Randolph hotel will also be renovated and join AJ Capital Partner's Graduate Hotels collection, which was launched in 2014 and operates 21 hotels in university towns across the United States. It will be the second Graduate property to launch outside the US, following the announcement in July of Graduate Cambridge.
The redesigned Randolph will take inspiration from the university and Phillip Allen, Graduate Hotels' chief development officer, international markets, said: "We are thrilled to announce the continued international expansion of the Graduate Hotels collection into one of the oldest and most prestigious university communities in the world."
In 1996 Macdonald Hotels & Resorts, which had grown to 100 hotels and resorts with an annual turnover of £240m, was floated on the stock market - a move that the founder Donald Macdonald later admitted was a mistake. "It cost us plenty - in terms of the product - to take the business to market," he told The Caterer in 2007.
The company was brought back into private hands in 2003 through a £620m management-led buyout in a joint venture with the Bank of Scotland which, at the time, was one of the biggest public-to-private deals ever seen in Scotland.
In 2007, the company sold 24 of its UK hotels to Moorfield Real Estate Fund for more than £400m, a move that helped the business to further establish a solid footing in the four- and five-star markets.