A US private equity fund launched an auction for Village Hotels, the UK’s largest mid-market chain. The sale is expected to reach £800 million.
Sources in City say that advisors to KSL Capital Partners are marketing Village through “teaser documents” they have shared with interested parties. Morgan Stanley was chosen by KSL in Denver to explore Village options last year. It is believed that the bank is looking for offers above £800 million.
KSL purchased the chain from De Vere Group for £485 millions in 2014. The chain had 3100 rooms spread across 25 locations. Village now has 33 hotels and more than 4,500 rooms. The proceeds from the sale of De Vere to KSL 10 years ago were used to pay back Lloyds Bank.
KSL has decided to sell Village, after the market indicated that real estate investors were interested.
City sources said that the company, which has freehold properties to its name, could be attractive to Blackstone, US private equity giant and Starwood Capital based in Miami. Starwood Capital now owns De Vere.
The chain of hotels, originally called Village Urban Resorts, was founded in 1995. They have between 100 and 150 rooms, and offer conference centres, pub-dining, gyms, and swimming pools.
KSL declined comment. Village has not responded.