HOSPITALITY group, African Sun Limited (ASL) has terminated its agreements for the sale of two hotels to TD Hotels & Leisure (Private) Limited
It had enterered negotiations to sell Beitbridge Hotel to TD Hotels.
Subsequently, negotiations for the sale of the Great Zimbabwe Hotel were held with the same prospective purchaser and another agreement of sale was executed on August 15.
However, in a statement last Thursday, ASL announced that the agreements with TD Hotels, a budding new hospitality group headquartered in Harare, were terminated.
“The board advises of the termination of the previously announced agreements with TD Hotels & Leisure (Private) Limited, classified as a category 3 transaction. The company will provide further updates on its future plans and any material changes thereto,” the hospitality group said.
It did not give reasons for the termination of the agreements.
African Sun would have received US$4 445 000 from the sale of Great Zimbabwe Hotel and associated hotel business in Masvingo and was primed to get US$2,5 million in the disposal of Beitbridge Express Hotel.
As defined by the Zimbabwe Stock Exchange, a category 1, category 2 or category 3 refer to a transaction that is principally an acquisition or disposal by an issuer.
The announcement comes as the hospitality group sought to use the proceeds from the sale as part of its capital-raising initiatives to expedite the refurbishment of several key hotels in its portfolio.
“To expedite the refurbishment of several key hotels in our portfolio, the board resolved to complement capital-raising initiatives by selling selected assets that are considered not core to the group’s future positioning,” ASL said, in its half year report ended June 30, 2024, released earlier this month.
“The BExpress Hotel and Great Zimbabwe Hotel were earmarked for sale, with an agreement of sale executed subsequent to the reporting date.”
Before the termination of the deal, the transaction was expected to have been completed before year end.