Mainboard-listed luxury resorts operator Banyan Tree says one of its subsidiaries is selling a hotel asset in Thailand for some S$110 million.
The subsidiary, Laguna Resorts & Hotels, is selling the “Dusit Thani Laguna Phuket” in Phuket to Dusit Thani Public Company.
The expected gain on disposal for Banyan Tree is about S$68.4 million.
The excess of the sale proceeds over the book value is expected to be S$69.6 million.
On this basis, the sale proceeds amount to about 2.7 times the book value of the hotel being sold.
Banyan Tree says the proposed disposal will reduce its exposure in Phuket, Thailand.
This, it says, is in line with its strategy of diversifying its assets away from Thailand, given the increased political risk that Thailand presents.
The firm has a heavy representation of Thai hotel properties amongst its assets.
Proceeds from the sale may be used for overseas investments, repayment of bank loans, and/or payment of dividends to shareholders.
Source : Channel NewsAsia – 11 Aug 2010