Malmaison Group has been acquired by KSL Capital Partners, a US-based private equity firm, for an undisclosed amount.
The deal sees KSL take ownership of brands including Malmaison and Hotel du Vin and will involve KSL investing ‘significantly’ to develop the UK positioning of the two hotel brands.
According to a statement, the investment will support the current development strategy initiated by CEO Gary Davis, who was appointed CEO of Malmaison in January 2012. Davis has outlined plans to commence an ‘extensive’ renovation program and expansion within the UK, European and international markets.
KSL has revealed that a new Malmaison hotel will be opening in Dundee in September 2013, while an existing property in St. Andrews will be converted to a Hotel du Vin in early 2014.
Established in 1994, Malmaison and Hotel du Vin have locations including a converted castle prison, hospital, sugar refinery and a former Royal Mail sorting office.
The hotels’ parent company, MWB Group Holdings, called in administrators in November after an issue involving inter-company loans backed by investors, which meant the firm couldn’t meet its liabilities. A separate part of the business, MBW Business Exchange, was sold to serviced office group Regus for £40 million in February 2013.
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Davis comments, ‘They [KSL] have recognised the significant potential in our business. Despite the wider challenging economic climate, we are proud of the strong operational and financial position that the hotels currently enjoy.
‘Building on these foundations, we look forward to taking the dynamic brands onward into a period of exciting growth over the coming years.’
Davis previously led the expansion of the De Vere Group’s Village Hotel portfolio and the global expansion programmes at Hard Rock Café and Planet Hollywood.
New backer KSL is a private equity firm which invests in travel and leisure businesses in five sectors: hospitality, recreation, clubs, real estate and travel services. Its portfolio, in the UK, includes The Belfry in the West Midlands (bought for £65 million), while its US interests include Montelucia Resort & Spa and Barton Creek Resort & Spa.
Richard Weissman, partner at KSL, adds, ‘At KSL, we look for unique travel and leisure businesses with strong management teams to help support and grow.
‘Malmaison and Hotel du Vin occupy a strong position in the UK market. With an exceedingly loyal following, we believe each brand has tremendous potential for further growth and expansion.’