Hotel Group Launches $123 Million Fully Underwritten Initial Public Offering of West Australian Hote

Hotel Group Launches $123 Million Fully Underwritten Initial Public Offering of West Australian Hote
29 November 2007

Compass Hotel Group (Compass) has launched an Initial Public Offering of Stapled Securities and Ordinary Shares to retail and institutional investors for the $190 million acquisition of 12 hotel and tavern properties across Western Australia.

At $1 a unit, 123 million Stapled Securities will be issued, with the IPO fully underwritten by lead manager and corporate adviser BBY Ltd.

Investors will receive dividends from the company – to manage and operate the hotels and tavern businesses - as well as distributions from the trust, which will lease the properties to the company.

With one additional leased tavern, the company plans to acquire other assets for the group, while providing value for security holders through the upgrade and re-development of the foundation properties being acquired.

Compass forecasts for the 2009 financial year a post-tax distribution yield of 9 per cent, with the company forecasting total revenue of $100.3 million and Earnings Before Interest and Tax of $18.4 million.

Chairman of Compass, Mr Rick Jones, said “Compass represents one of the largest freehold-owned and operated hotel and tavern portfolios in Western Australia, combining positive growth from the state’s vibrant economy with strong management.

We are delighted that many of the hotels and taverns across Western Australia have joined in this new group, as the state has lost many of these venues to the spiraling number of residential developments.

“The initial portfolio of the properties have been identified for their exceptional positioning and redevelopment potential (as taverns/hotels), while they have been selected in locations exposed to strong population and economic growth".

Compass management team is led by Managing Director, Bryan Northcote, who has been actively involved in the hospitality sector over the last 27 years and is currently a shareholder in Clarity Management Group Pty Ltd, a specialist provider of financial, administration and operational services to the hotel, club and restaurant sectors.

For Further Information please contact us or call:

Bryan Northcote
Compass Hotel Group
(02) 8908 9500

Tim Allerton
City Public Relations
(02) 9267 4511

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