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EBRD and IFC Support Expansion of Leading Croatian Hotel Group
London, June 14, 2007- The European Bank for Reconstruction and Development
and the International Finance Corporation, the private sector arm of the World
Bank Group, are providing financing to GSHR Group, one of the largest hotel
groups in Croatia.
The €130 million financing package will be provided via loans and equity
stakes and will support the further expansion of hotels owned and managed by
GSHR Group, formerly known as ALH Group. Senior loans total €93 million, of
which €38 million will be syndicated to Hypo Alpe Adria Bank, the current
lender to the group. There will also be equity investments from both EBRD and
IFC for a 25.1 percent and 12 percent shareholding, respectively, in GSHR
Holdings Limited, the holding company of the group. The financing will extend
the group’s loan tenors and strengthen its capital base.
Goran Štrok, Chairman of GS Holdings Limited, said the investments of EBRD and
IFC in GS Holdings Ltd are very important for the further development of the
group as well as the development of tourism in Croatia. The financing will
help us to apply our experience in the hotel business in neighbouring
countries and expand further in the region, he said.
The GSHR Group owns a number of landmark hotels in Croatia, including Hotel
Excelsior, Hotel Dubrovnik Palace, Hotel Kompas, and Hotel Bellevue in
Dubrovnik, as well as Grand Hotel Bonavia in Rijeka. It also owns the SC Wren
Hotel in the United Kingdom. The group’s hotels total 1,806 rooms and employ
890 people.
Varel Freeman, the EBRD’s First Vice President, said that the tourism sector
in the Southeast Europe, and in Croatia in particular, is of strategic
importance and that investing in GSHR Group, which has a proven track record
and a commitment of expanding its business, will give excellent support to the
wider tourism industry regionally.
Dimitris Tsitsiragos, IFC Director for Global Manufacturing and Services, said
that the GSHR Group has been a pioneer in helping Croatia recover from
conflict and transform into a premier tourist destination. Through this
investment, IFC will support the group as it expands its operations in Croatia
and subsequently further into Southern Europe, Mr Tsitsiragos said.
About EBRD
The European Bank for Reconstruction and Development, owned by 61 countries
and two intergovernmental institutions, aims to foster the transition from
centrally planned to market economies from central Europe to central Asia. The
EBRD is the largest single investor in the region and mobilises significant
foreign direct investment beyond its own financing. As of May 2007, it had
committed €33.5 billion to 1,487 projects throughout its countries of
operations. EBRD’s commitments in Croatia exceed €1.7 billion. In the
property and tourism sector alone, it has committed €1.53 billion in 70
projects across Central and Eastern Europe and the Commonwealth of Independent
States. For more information, please visit www.ebrd.com.
About IFC
IFC, the private sector arm of the World Bank Group, promotes open and
competitive markets in developing countries. IFC supports sustainable private
sector companies and other partners in generating productive jobs and
delivering basic services, so that people have opportunities to escape poverty
and improve their lives. Through FY06, IFC Financial Products have committed
more than $56 billion in funding for private sector investments and mobilized
an additional $25 billion in syndications for 3,531 companies in 140
developing countries. IFC Advisory Services and donor partners have provided
more than $1 billion in program support to build small enterprises, to
accelerate private participation in infrastructure, to improve the business
enabling environment, to increase access to finance, and to strengthen
environmental and social sustainability. For more information, please visit
www.ifc.org.
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