Macdonald Hotels has pulled off a deal which will see the group sell 27 of its hotels and become debt free. The sale, to a “major private equity and real estate business”, will be concluded in August, but the Group has signed heads of terms and is now in “confidential and exclusive talks” which would see the group’s outstanding £190m Bank of Scotland debt cleared and cash available for investment in its remaining estate.
The seven Scottish hotels being sold are: Holyrood Hotel, Edinburgh; Houstoun House, West Lothian; Inchyra Hotel & Spa, Falkirk; Crutherland House Hotel, Glasgow; Rusacks Hotel, St Andrews;
Cardrona Hotel, Golf & Spa, Peebles; and Loch Rannoch,Perthshire.All of which come under the Macdonald banner.The retained business includes its Highland properties Macdonald Aviemore Resort and Drumossie, the Morlich Hotel, Macdonald Highlands Hotel, Macdonald Aviemore Hotel and Luxury Woodland Lodges – all in Aviemore – as well as a further nine Macdonald Resorts located in the UK and Spain.
The news came as Macdonald published its annual results for the year ended 29 March 2018, which showed a loss after tax of £2.2m, compared with a profit after tax of £4.2m the previous year.
The group’s founder and executive chairman, Donald Macdonald (72), said, “It’s been 30 years since I started the business along with my fellow board members Gerry Smith and Gordon Fraser, and it’s been a privilege to have shared such an incredible journey with both of them and with so many other fantastic colleagues.”
Mr Smith (68) has worked alongside Donald Macdonald for 47 years and served as the group’s chief operating officer for 18 years. Mr Fraser (61) has worked with Mr Macdonald for 36 years and was finance director at Macdonald Hotels before becoming deputy chairman.
“The preferred bidder fits superbly with our ongoing aspirations for the hotels and they will bring significant investment and expansion of the portfolio.”
Donald Macdonald added,“This is excellent news for the 2,200 loyal employees based at these hotels, their 190 colleagues in our central support team and also for our valued customers and suppliers.
“I’m hugely grateful to every one of our staff for their continued contribution and dedication to the business. We never lose sight of the fact that we can only provide great service to our guests through a talented and valued workforce.
“Throughout this process, potential investors have regularly commented on both the strength of our management team and the dedication of our staff, and this deal will give them a superb future.”