African Sun (ASUN), a leading hospitality group, has announced plans to sell two of its hotel properties: The two business hotels include the Great Zimbabwe Hotel sited in Masvingo and Beitbridge Express Hotel.
This action is done on the backdrop where the group has been working on a policy of unlocking value of its assets and mobilizing capital for future undertaking.
On the same note, in the latest shareholder update, ASUN clarified that these properties are not in its pipeline for the future. It will be recalled that the status of The Great Zimbabwe Hotel will be disposed through a sale also at a price of $4.
The Great Zim Hotel which is valued at $45 million going to The Beitbridge Express Hotel, which is going for $2. 5 million. Both the hotels will be sold to TD Hotels & Leisure (Private) Limited Company by entering into the agreements fo the final of the purchase.
Strengthening core operations
The properties which ASUN has decided to sell have been arrived at by a resolution made in the board meeting on 22 March 2024. The Great Zimbabwe Hotel has been contributing minimal earnings to the group revenues and edi further, the Beitbridge Express Hotel, which has not been operating since 2016 due to adverse trading climate is said to be non-strategic assets. The sale is believed to increase the company’s capital with a view to expanding and renovating the prime properties that the company owns.
Talks for the Beitbridge Hotel started earlier and therefore an agreement was arrived at July 18, 2024. The first privatisation process was the sale of Great Zimbabwe Hotel then on August 15, 2024 and all the two transactions were supposed to be completed by November 1, 2024.
ASUN has improved a lot in the last few years, or at least since the global pandemic began. To continue funding the ongoing works of its basic hotels, the company has therefore chosen to divest some assets which are not central to the firm’s core strategic plan. The group explained that this decision will assist the future financial position of the group to improve.
In this regard, the buyer, TD Hotels & Leisure (Private) Limited has agreed to pay the residual price for the acquired assets within 45 days after signing the sale agreements. The transactions, once they are processed indicate a milestone in the strategic development of the company in question, namely African Sun.
