SYDNEY—Mantra Group Ltd. has entered into an agreement to acquire Outrigger Hotels & Resorts Australia Pty Ltd. for $29.5 million.
Toward this, Mantra Group is launching a fully underwritten institutional placement to raise approximately $50 million to assist in funding the Outrigger acquisition as well as providing Mantra Group with additional capital to fund identified pipeline opportunities.
Mantra Group also will offer all existing eligible shareholders in Australia and New Zealand the opportunity to acquire additional shares (up to a fixed amount) via a non-underwritten Share Purchase Plan.
As part of the planned acquisition, Mantra Group, via a wholly owned subsidiary, has agreed to acquire all of the issued shares in Outrigger, which operates four resort properties in Australia: Outrigger Surfers Paradise; Outrigger Twin Towns Resorts, Coolangatta; Outrigger Little Hastings Street Resort & Spa, Noosa; and Boathouse Apartments by Outrigger Airlie Beach.
According to the company, these properties are located in key destinations where Mantra Group has a long-standing presence, and the transaction presents an opportunity for Mantra Group to increase its footprint across four locations in a single transaction that would yield 984 keys under management, plus freehold title to real estate comprising restaurants, conference facilities and other common areas.
Mantra Group’s CEO, Bob East, stated: “This acquisition is complementary to our existing portfolio and, together with future pipeline growth initiatives, is expected to supplement Mantra Group’s strong organic growth with incremental earnings. We look forward to working with the owners, guests and team members to make the transition as smooth as possible.”
The acquisition is expected to close in June.
Highbury Partnership Pty Ltd is acting as Mantra Group’s financial adviser.