Taking all the usual precautions for a group listed on the stock exchange, the Board of Directors of Dalata Hotel Group is examining every opportunity to increase the value of the company for the benefit of its current shareholders. This would quite naturally involve a partial or total sale of the capital.
Founded in 2007, the Dalata hotel group operates in the 4* segment mainly in the United Kingdom and Ireland. More recently, it has expanded into continental Europe to further develop its portfolio in major European cities. The group is listed on Euronext Dublin and the London Stock Exchange.
It currently has 56 properties in urban areas, including 30 owned hotels (valued at €1.7 billion) and 23 leased hotels with an average lease term of 29 years. The hotels are operated under two main brands: 27 Clayton Hotels and 26 Maldron Hotels. Dalata also operates three hotels in Dublin under management contracts: the Samuel Hotel, the Gibson Hotel and the Hotel 7.
A largely profitable group whose share price is undervalued
Sales for 2024 amounted to €652 million, giving a gross margin (adjusted EBITDA) of €234.5 million and adjusted EBITDA after rental payments of €173.2 million.
The Board of Directors considers that the current share price (around €5.50), which values the Group at around €1.2 billion, does not reflect its assets or its performance. The sale of the share capital should release the potential not currently taken into account by the market.
All options are on the table. A partial entry by an investment fund, a full takeover, or even a merger and acquisition with a group that would seize the opportunity to add to its portfolio. The strategic review, which may or may not lead to a public offer, will be carried out with the assistance of Rothschild & Co.
Giving the Group the resources to achieve its ‘Objective 2030’
John Hennessy, Chairman of Dalata, expects the announcement to trigger interest in his undervalued group: ‘We firmly believe in our Vision 2030, but access to capital is the key to its success’.
‘Our ambition is to reach 21,000 rooms by 2030. We have an outstanding management platform to deliver on this vision, but we need to raise more capital. This strategic review will help us identify the best options to achieve this,’ adds Dermot Crowley, its Chief Executive.
By announcing their intention, the group’s directors are beginning a formal sale process that complies with the Irish Public Offer Rules.
The plan is already well underway, with 1,600 rooms in the pipeline
The objective of 21,000 rooms by 2030 corresponds to 80% growth in the hotel portfolio, through acquisitions of existing hotels and the development of new hotels, while maintaining the current balance between properties and long-term rentals.
Since the launch of the Target 2030 plan, 910 rooms have been added to the pipeline: the acquisition of the Radisson Blu Hotel, Dublin Airport for €83m; a lease for a new Clayton hotel on Old Broad Street; and the acquisition of a second hotel in Edinburgh, which will become a Clayton hotel.
The opening of four new Maldron hotels in 2024 has taken the UK portfolio to over 5,000 rooms, with an announced pipeline of over 1,600 rooms, including the Maldron Hotel Croke Park in Dublin and the Clayton Hotel St. Andrew Square in Edinburgh, currently under construction.
A promising first quarter in 2025
Management is confident about 2025 performance, given that like-for-like RevPAR growth for the first quarter was 2.5% above 2024 levels. Dublin alone is performing strongly, with RevPAR up 5% on 2024, following the absorption of supply at the start of the year.
