HARARE – Meikles group has advised that it will soon seek the approval of shareholders to see through the disposal of Meikles hotel to Alwardy. A month ago, reports of the deal emerged which were later confirmed by the group through a cautionary statement as well as in its annual results.
Meikles seeks to dispose the flagship 5 star Meikles Hotel located in the central business district of Zimbabwe’s capital city, Harare. The hotel has 312 rooms in 2 luxurious multi storey wings.
Earlier reports indicate the deal would fetch as high as $30 million with the hotel having been refurbished an estimated $9 million in 2013.
The Dubai based, Albwardy Investments will take over both the hotel premise and management through its special purpose vehicle Choicebrands which is incorporated in Zimbabwe.
The management phase will come as second phase where Choicebrands will acquire the rights to operate the brand name and take over all hotel employees.
In its results for the 12 months period to March 2019, Meikles said the hotel requires substantial modernisation of guest facilities as well as electro mechanical and plumbing infrastructure to restore its 5 Star status.
Initial forecasts point to an estimated $30 million in capex needed for the exercise. The group considers that it is not in a position to raise the amount and therefore sees it necessary to place its development in the hands of skilled international operators.
In the 12 months period to March 2019, Meikles’ hospitality business raked in $9.1 million up from $7.6 million in the prior year. The hotel business has generally underperformed compared to the other segments such as agriculture and retail.
Equity Axis News
Raynold Mhotseka is a Journalism and Media Studies student at the University of Zimbabwe. He serves as a news writer at financial research firm, Equity Axis where he is currently on attachment. He can be contacted through the following email links, firstname.lastname@example.org and email@example.com.